Does Antitakeover Provision Harm Shareholders? Indexing for Antitakeover Provisions in China
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Sirui Han
Abstract
Does antitakeover harm shareholders? Encumbered by a multitude of theoretical perspectives, the legality of antitakeover remains a shared intellectual inquiry that the A-share market has yet to fully address. This paper constructs a governance index for the A-share market based on a manually collected and hand-coded research dataset (C-index). This dataset, comprising 4251 historical firm-level profiles of Antitakeover Provisions (ATPs), is meticulously sampled from companies listed in China from 2001 to 2017. The study investigates the logical correlation between antitakeover strength, financial performance, and the governance attributes of the company by leveraging the index’s economic utility. Additionally, this paper explores the firm-level factors that prompt corporate directors to integrate ATPs. From an empirical standpoint, it provides evidence that the governance index of firm-level strength of ATPs is positively correlated with share liquidity, institutional shareholding, private ownership, and the company’s commitment to achieving specific financial performance.
Funding source: HKUST Start-up Fund
Award Identifier / Grant number: R9911
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Research funding: This work was supported from The Hong Kong University of Science and Technology Start-up Fund (ID.: R9911) for the captioned project and Fulbright-RGC Research Scholar Fund.
Supplementary Material
This article contains supplementary material (https://doi.org/10.1515/ajle-2023-0119).
© 2023 Walter de Gruyter GmbH, Berlin/Boston
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Articles in the same Issue
- Frontmatter
- Research Articles
- The Role of Judges in Selecting Efficient Norms in a Common Law System: A Law and Economics Perspective
- Law-and-Economics of Business Judgment Rule in India
- Does Antitakeover Provision Harm Shareholders? Indexing for Antitakeover Provisions in China
- Seventy Years of Marriage and Family Law in China: Achievements, Challenges and Prospects
- Estimating the International Cocaine Market: A Novel Combination of Excess Compensation and Stochastic Frontier Analysis
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