Capital structure of Chinese listed SMEs: an agency theory perspective
Prior work examining the antecedents of capital structure for small and medium-sized enterprises in emerging markets is limited. This paper sheds light on how the corporate governance mechanisms adopted by firms on the newly established Growth Enterprise Market (GEM) in China influence their use of...
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| Format: | Article |
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Springer
2016
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| Online Access: | https://eprints.nottingham.ac.uk/52670/ |
| _version_ | 1848798781808574464 |
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| author | Huang, Wei Boateng, Agyenim Newman, Alexander |
| author_facet | Huang, Wei Boateng, Agyenim Newman, Alexander |
| author_sort | Huang, Wei |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | Prior work examining the antecedents of capital structure for small and medium-sized enterprises in emerging markets is limited. This paper sheds light on how the corporate governance mechanisms adopted by firms on the newly established Growth Enterprise Market (GEM) in China influence their use of debt. We find that the financial leverage of GEM firms is positively influenced by executives’ shareholding and their excess cash compensation. Ownership concentration appears to reduce leverage, whereas the percentage of tradable shares increases leverage. In contrast, institutional investors’ shareholding does not influence the level of debt. Traditional factors such as tax and operating cash flow are insignificant in explaining the debt levels among GEM firms. |
| first_indexed | 2025-11-14T20:25:14Z |
| format | Article |
| id | nottingham-52670 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| last_indexed | 2025-11-14T20:25:14Z |
| publishDate | 2016 |
| publisher | Springer |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-526702020-05-04T18:05:21Z https://eprints.nottingham.ac.uk/52670/ Capital structure of Chinese listed SMEs: an agency theory perspective Huang, Wei Boateng, Agyenim Newman, Alexander Prior work examining the antecedents of capital structure for small and medium-sized enterprises in emerging markets is limited. This paper sheds light on how the corporate governance mechanisms adopted by firms on the newly established Growth Enterprise Market (GEM) in China influence their use of debt. We find that the financial leverage of GEM firms is positively influenced by executives’ shareholding and their excess cash compensation. Ownership concentration appears to reduce leverage, whereas the percentage of tradable shares increases leverage. In contrast, institutional investors’ shareholding does not influence the level of debt. Traditional factors such as tax and operating cash flow are insignificant in explaining the debt levels among GEM firms. Springer 2016-08-30 Article PeerReviewed Huang, Wei, Boateng, Agyenim and Newman, Alexander (2016) Capital structure of Chinese listed SMEs: an agency theory perspective. Small Business Economics, 47 (2). pp. 535-550. ISSN 0921-898X Capital structure； Executive compensation； Ownership structure； SMEs China https://link.springer.com/article/10.1007%2Fs11187-016-9729-6 doi:10.1007/s11187-016-9729-6 doi:10.1007/s11187-016-9729-6 |
| spellingShingle | Capital structure； Executive compensation； Ownership structure； SMEs China Huang, Wei Boateng, Agyenim Newman, Alexander Capital structure of Chinese listed SMEs: an agency theory perspective |
| title | Capital structure of Chinese listed SMEs: an agency theory perspective |
| title_full | Capital structure of Chinese listed SMEs: an agency theory perspective |
| title_fullStr | Capital structure of Chinese listed SMEs: an agency theory perspective |
| title_full_unstemmed | Capital structure of Chinese listed SMEs: an agency theory perspective |
| title_short | Capital structure of Chinese listed SMEs: an agency theory perspective |
| title_sort | capital structure of chinese listed smes: an agency theory perspective |
| topic | Capital structure； Executive compensation； Ownership structure； SMEs China |
| url | https://eprints.nottingham.ac.uk/52670/ https://eprints.nottingham.ac.uk/52670/ https://eprints.nottingham.ac.uk/52670/ |