Enhancing external oversight: The complementary role of regulatory minority shareholders in China

Shengyuan Huang, Junhong Li, Xiaoguang Yang and Ye Zhou

Finance Research Letters, 2024, vol. 65, issue C

Abstract: In 2014 the China Securities Investor Services Center (CSISC) was set up to serve as a government-backed entity to represent minority shareholders. Does CSISC achieve its role as a complementary external regulator? We present empirical evidence to show that CSISC can effectively alleviate the severity of the minority shareholder expropriation problem. Further, the effect is particularly noticeable in firms that lack measures to prevent misconduct by blockholders, which implies that CSISC significantly complements existing external regulation.

Keywords: China securities investor services center; Tunneling; Minority shareholder protection; External regulation (search for similar items in EconPapers)
JEL-codes: G34 G38 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:65:y:2024:i:c:s1544612324005518

DOI: 10.1016/j.frl.2024.105521

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