Corporate Governance Characteristics of Delisted Firms – A Discriminant Analysis Approach

Muhammad Nasir Malik (), Muhammad Xia Xinping and Muhammad Asif Muzaffar
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Muhammad Nasir Malik: COMSATS Institute of Information Technology, Lahore, Pakist
Muhammad Xia Xinping: Huazhong University of Science & Technology, Wuhan, China
Muhammad Asif Muzaffar: Institute of Business & Management, UET, Lahore, Pakistan

International Journal of Economics and Empirical Research (IJEER), 2014, vol. 2, issue 4, 156-162

Abstract: The purpose of this study is to distinguish between delisting and surviving firms using corporate governance characteristics of the firms.To this end, we employ discriminant analysis on a sample of industry and size matched pair of delisting firms. The sample was retrieved as a subset of firms listed on Shanghai and Shenzhen stock exchange between 2000 and 2008. The corporate governance characteristics used are shareholder activism, board activity, audit committee, board size, board independence, ownership concentration and insider ownership. We show that board activity, insider ownership, shareholder activism and ownership concentration are the most important characteristics that can distinguish between delisting and surviving firms two years prior to the actual delisting event.

Keywords: Corporate governance; involuntary delisting; Shanghai stock exchange (search for similar items in EconPapers)
JEL-codes: F22 O32 (search for similar items in EconPapers)
Date: 2014
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