How do the board structures of listed companies in Hong Kong affect the interests of their shareholders

Pao Yue-kong Library Electronic Theses Database

How do the board structures of listed companies in Hong Kong affect the interests of their shareholders

 

Author: So, Rebecca Kam-king
Title: How do the board structures of listed companies in Hong Kong affect the interests of their shareholders
Degree: M.B.A.
Year: 1997
Subject: Going public (Securities) -- China -- Hong Kong
Directors of corporations -- China -- Hong Kong
Stockholders -- China -- Hong Kong
Hong Kong Polytechnic University -- Dissertations
Department: Dept. of Management
Pages: vi, 103 leaves : ill. ; 31 cm
Language: English
InnoPac Record: http://library.polyu.edu.hk/record=b1250446
URI: http://theses.lib.polyu.edu.hk/handle/200/1554
Abstract: This paper focuses on an interesting issue : How do the board structures of listed companies in Hong Kong affect the interests of their shareholders ? From the perspective of western countries such as Germany, U.S.A. and United Kingdom, ownership and management are two different aspects which may conflict with each other in managing the business in an organization. However, the above tends to be inapplicable to Hong Kong. Most listed companies in Hong Kong are majority-controlled by an individual or a family. Family members very often take up the role of directors and chairman in the company and they are greatly involved in both the board activities and day-to-day management. Originated from the strong Chinese culture and management style, most listed companies in Hong Kong no matter how big their company sizes are, the structures of both the board of directors and the management teams are maintained to ensure the control of the family business. Unlike those happen in western countries, the conflict of interests between owners and management team may become more serious since shareholders have no way to control their equity which is vested in the hands of the management when company's structures become more complex. Therefore, the concept of "separation of ownership and management" applied in western countries is not applicable to Hong Kong. However, it is not apparent whether there is any similar checks and balances introduced in Hong Kong. We have learnt from the news that some Executive Directors of the board have abused and cheated their companies. The abuse of powers may be the result of insufficient levels of accountability to ensure that powers are exercised to maximize shareholders' wealth. The reason may be attributed to the failure of having a sound board structure as mechanism to tie together the use of board powers and accountability in respect of all business spectrums. Starting from the fundamental theory of "Agency Cost" which brings many thoughts to the controversial issue on corporate governance, the researcher attempted to study one of the significant issues whether the current board structures of listed companies in Hong Kong provide enough of a balance to protect shareholders' interests against the abuse of board powers. In the research, five hypotheses were examined to study the situation and to have a glimpse of the trend in Hong Kong in the aspect of corporate governance, trying to throw light on how the board structures of listed companies in Hong Kong affect the interests of shareholders. Archival records and self-reports such as annual reports and postal questionnaries were used. Convincing support was found to uphold the belief that "the more independent the board structures of listed companies in Hong Kong, the more protection of shareholders' interests".

Files in this item

Files Size Format
b12504464.pdf 3.386Mb PDF
Copyright Undertaking
As a bona fide Library user, I declare that:
  1. I will abide by the rules and legal ordinances governing copyright regarding the use of the Database.
  2. I will use the Database for the purpose of my research or private study only and not for circulation or further reproduction or any other purpose.
  3. I agree to indemnify and hold the University harmless from and against any loss, damage, cost, liability or expenses arising from copyright infringement or unauthorized usage.
By downloading any item(s) listed above, you acknowledge that you have read and understood the copyright undertaking as stated above, and agree to be bound by all of its terms.

     

Quick Search

Browse

More Information