Is the Chinese Anticorruption Campaign Authentic? Evidence from Corporate Investigations

John M. Griffin (), Clark Liu () and Tao Shu ()
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John M. Griffin: McCombs School of Business, University of Texas, Austin, Texas 78712
Clark Liu: People's Bank of China School of Finance (PBCSF), Tsinghua University, Beijing 100083, China
Tao Shu: School of Management and Economics, Shenzhen Finance Institute, Chinese University of Hong Kong, Shenzhen 518172, China

Management Science, 2022, vol. 68, issue 10, 7248-7273

Abstract: This paper examines whether the massive Chinese anticorruption campaign ensnares corrupt firms, contains a political component, and reduces corporate corruption. Consistent with the campaign’s stated objectives, investigated executives are more likely to come from Chinese firms with characteristics commonly associated with measures of poor governance, self-dealing, and inefficiencies. However, affiliations with prominent investigated political leaders increase investigation likelihood, while university affiliations with current central leadership decrease investigation likelihood, possibly indicating political partiality. Except for reported entertainment expenditures and chief executive officer pay, there has been little evidence of a substantial overall decrease in measures of potential corporate corruption.

Keywords: China; anticorruption campaign; corporate governance; political connections; corporate corruption (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (9)

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