Browsing by Author "Chi J"

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Adjusted air pollution exposure and corporate innovation investment: Evidence from China
(Wiley, 2025-06-19) Liu J; Chi J; Kabir MH; Hafeez B
Using a novel measure of air pollution exposure adjusted for the heterogeneity of exposures and the extent of local air pollution, we find a significant negative relationship between adjusted air pollution exposure and corporate innovation investment. This finding still holds after controlling for endogeneity and conducting a series of robustness tests. While the relationship is mediated through net operating cash flows and debt financing costs, we also find that firms with high adjusted air pollution exposure might have deteriorated productivity of R&D personnel, which ultimately hinders innovation input and output. However, state ownership appears to mitigate this adverse effect of adjusted air pollution exposure. Furthermore, the adverse effects of air pollution exposure on innovation investment are more pronounced among firms that disclose environmental information, exhibit low managerial risk tolerance, operate in non-polluting industries, or are located in developed and less polluted regions. Additionally, the negative impact is particularly evident in the subsample of firms after the signing of the 2015 Paris Agreement. This study sheds light on the importance of adjusted air pollution exposure and its influence on corporate investment in China.
Do foreign experienced managers influence employee compensation? Evidence from labor investment in China
(Emerald Publishing Limited, 2025-09-23) Sun Z; Anderson HD; Chi J
Purpose This study aims to investigate whether and how foreign experienced managers influence employee compensation in Chinese firms. While prior research has examined the impact of such managers on corporate governance, innovation and performance, little is known about their effect on labor investment, particularly “rank-and-file” employee compensation. The authors argue that foreign experienced managers are more likely to pursue complex value-added strategies requiring skilled labor, thus increasing compensation levels. Design/methodology/approach Using a sample of Chinese A-share listed firms, the authors identify foreign experienced managers as CEOs or chairpersons with prior work or study experience outside mainland China. The analysis uses panel regressions, as well as instrumental variable estimation, difference-in-difference (DID) tests and propensity score matching (PSM), to address endogeneity. The authors further examine mechanisms and heterogeneity analysis. Findings Firms with foreign experienced managers pay significantly higher employee compensation. This relationship is more pronounced where firms have excess cash or lower operating leverage. Mechanism tests support the efficiency wage theory where managers increase the proportion of skilled employees. In private firms, foreign experienced managers appear to increase compensation to improve total factor productivity and firm value. In contrast, foreign experienced managers in state-owned enterprises appear more motivated by political or social goals through enhanced employee treatment. In addition, the authors also find that foreign experienced managers are associated with higher labor cost stickiness, especially in private firms. Originality/value To the best of the authors’ knowledge, this is the first study to link managerial foreign experience with employee compensation. The results are particularly relevant for firms and policymakers aiming to balance employee welfare, productivity and strategic human capital investment in the context of global managerial mobility.
Do socially preferred firms disclose more ESG information?
(Emerald Publishing Limited, 2025-08-25) Peng Z; Anderson HD; Chi J; Liao J
Purpose While research shows “sin” firms voluntarily disclose more social responsibility information, little research examines such practices in socially preferred industries. This study aims to address this gap by contrasting firm-level environmental, social and governance (ESG) information disclosure of New Zealand firms. Design/methodology/approach This study extracts all New Zealand listed companies for which Bloomberg provides ESG data from 2010 to 2023. Besides, this study excludes firms in financial service sector. The final sample contains 52 companies and 514 firm-year observations. Findings This study find that retirement village firms and the healthcare industry whose operations are commonly considered to be socially preferred, disclose less ESG information than firms in other industries. This result remains after a series of robustness tests, including alternative measures and matching samples. The addition of ESG provisions in the 2017 New Zealand Exchange’s (NZX) Corporate Governance Code, female and independent directors have a significantly positive moderating effect on ESG disclosure. In addition, retirement village firms with higher financial constraints increase ESG disclosure. Furthermore, this study finds that increased ESG disclosure enhances market valuation and reduces the cost of debt. Research limitations/implications A natural limitation of this research is its limited sample size, focusing on New Zealand firms, which may limit the generalisability of the findings to other regions with different regulatory and cultural contexts. Practical implications This research suggests that firms in socially preferred industries, like healthcare and retirement villages, may need stronger incentives or guidelines to improve ESG disclosure. Enhancing corporate governance, particularly through independent and female directors, could positively influence ESG transparency, guiding policy and board composition strategies. Social implications The research highlights a potential gap in ESG disclosure among industries. This suggests a need for greater public awareness and advocacy to ensure that even socially favoured sectors are held accountable for their environmental and social impacts, promoting broader corporate responsibility. Originality/value This study contributes to the literature by revealing that socially preferred industries, such as healthcare and retirement villages, may disclose less ESG information than other sectors. It provides novel insights into the role of corporate governance, particularly the influence of female and independent directors, in enhancing ESG transparency.
How does digital finance impact birth rates: Evidence from China
(Elsevier B V on behalf of the Economic Society of Australia (Queensland) Inc, 2025-06) Chen J; Chi J; Smith D; Yuen M
Digital finance (DF), the integration of tradition financial services and new information technology, has been shown to have various impacts in social behaviour. However, how DF affects people's fertility behaviour is still under investigation and worth exploring from the point of view of long-term economic growth. By employing a DF index, publicly available city-level birth rates in 287 Chinese cities, we find DF has a negative influence on birth rates. This finding is supported by endogeneity and several robustness tests. Mechanism tests show DF increases investment opportunities and therefore reduces the need of having children for support in old age. DF increases consumption and possibly individualism and also increases women's economic independence and their opportunity cost of having children, leading to lower birth rates. Given the development of DF is an inevitable trend, we further find that out of the three components of DF index measures, the coverage of DF significantly decreases birth rates, while the higher level of DF development, depth and digitalization, have much less negative impact on birth rates. Finally, this negative impact can be moderated when governments make policy efforts to increase educational and medical resources and provide protection of religion. This paper provides a novel perspective on the influence of DF on social behaviour through DF's direct impact on investments, consumption and income.
In the heat of the moment, secrets will out: Oil price uncertainty and firm green innovation disclosure
(Elsevier Inc, 2025-03) Huang K; Chi J; Liao J; Yuen MK
This study investigates the relationship between oil price uncertainty and corporate green innovation disclosure behaviour. Drawing on a textual analysis of annual reports and social responsibility reports of Chinese listed companies, we construct a measure for the intensity of corporate green innovation disclosure. We find a significantly positive relationship between oil price volatility and the level of green innovation disclosure. This relationship remains robust after conducting robustness tests and addressing potential endogeneity. Further analysis reveals that this positive association is moderated by several firm-level factors, including environmental performance, legitimacy demands, and political connections. Additionally, the positive relationship is more pronounced in firms subject to higher regional environmental regulation intensity and market-based green initiatives. Our findings contribute new evidence to corporate sustainable development, demonstrating that energy uncertainty significantly influences information transparency in green innovation disclosure.
The economic impact of capital expenditures: Environmental regulatory delay as a source of competitive advantage?
(1/01/2013) Wirth C; Chi J; Young M
This study tests the proposal that by undertaking voluntary capital expenditures that are subject to lengthy environmental regulatory delays, listed companies can gain a competitive advantage. The stock market is found to react positively to new capital expenditure announcements when projects are expected to experience long delays in obtaining environmental regulatory approval. Two sources of potential competitive advantage are firm learning and first mover advantages. Lengthy delays in regulatory processes and high compliance costs incurred for environmentally-sensitive projects may allow firms opportunities to develop specialised capabilities and/or to deter industry competitors and new entrants, resulting in greater expected project NPVs. The findings also underscore the importance of non-financial environmental information to investors in their assessment of firm value. © 2013 Blackwell Publishing Ltd.
Weathering the storm: How does firm oil price uncertainty exposure impact green innovation in times of geopolitical tensions
(Elsevier B V, 2026-01-05) Huang K; Chi J; Liao J; Yuen MK
This study examines the impact of oil price uncertainty sensitivity on corporate green innovation, in times of geopolitical tensions. Using manually collected import and export data at the destination country-firm level from China Customs Dataset, we construct the unique measure of firm-level geopolitical tensions of Chinese listed companies received from foreign supply chain partners. Our results reveal that firms with higher exposure to oil price uncertainty are more likely to engage in green innovation. Importantly, geopolitical tensions significantly and positively moderate the relationship between corporate oil price uncertainty exposure and green innovation efforts, with the effect being particularly pronounced in the context of geopolitical tensions originating from customer countries. Further analysis reveals that domestic supply chain alliances and supply chain efficiency mitigate firms' urgency for green innovation. Finally, we find that the effects of oil price uncertainty and geopolitical tensions on green innovation are more pronounced in firms with higher international exposure, and greater competitive pressures.