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Is corporate governance in China related to performance persistence?

Research output: Contribution to journalJournal articlepeer-review

<mark>Journal publication date</mark>04/2016
<mark>Journal</mark>Journal of Business Ethics
Issue number4
Number of pages18
Pages (from-to)575-592
Publication StatusPublished
Early online date26/09/14
<mark>Original language</mark>English


This paper examines the relationship between performance persistence and corporate governance (as proxied for by board characteristics and shareholder structure). We document systematic differences in performance persistence across listed companies in China during 2001–2011, and empirically demonstrate that firms with better corporate governance show higher performance persistence. The results are robust over both the short and long terms. We also find that performance persistence is an important factor in refinancing, and it can lower companies’ costs of borrowing. Overall, our findings offer important implications for business ethics, as we demonstrate how corporate governance can lower companies’ costs of debt.