in Table 4 is driven by AFTER×SOLVED_CSRC AFTER×SOLVED_CSRC2 (shareholders’ meeting), and AFTER×SOLVED_CSRC4 (management’s responsibilities), (miscellaneous governance problems). AFTER×SOLVED_CSRC8 Because we use both and to proxy for net shareholder value, we OROA Q Tobin’s examine the regression results of both and to draw inferences. We find no OROA Tobin’s Q consistent evidence across the two regressions that correcting any individual categories of corporate governance noncompliance problems improves shareholder value. Specifically, the coefficient on (the miscellaneous category) is significantly AFTER×SOLVED_SELF8 positive for the regression but insignificant for the regression. Likewise, the OROA Q Tobin’s coefficient on meeting) is not significant for the AFTER×SOLVED_CSRC2 (shareholders’ regression but significantly positive for the regression. We also find no OROA Q Tobin’s consistent evidence suggesting that correcting any individual categories of corporate governance problems reduces shareholder value. Specifically, the coefficients on compensation and accountability), AFTER×SOLVED_SELF6 (management’s (corporate disclosure), and (the AFTER×SOLVED_CSRC7 AFTER×SOLVED_SELF8 miscellaneous category) are significant in either the regression or the OROA Q Tobin’s regression but not both. Interestingly, the coefficients on (i=6 for AFTER×UNSOLVED_SELFi management’s compensation and accountability, 7 for corporate disclosure, and 8 for the miscellaneous category) are significantly negative in the Q regression. Taken at face value, these Tobin’s coefficients suggest that the listed self-reported corporate governance problems related firms’ to these three categories are new to the stock market and thus result in a significant reduction in after the revelation of these uncorrected problems. However, we caution the Q Tobin’s reader to interpret these coefficients with caution because the majority values of UNSOLVED_SELF are zero.
AFTER×SOLVED_CSRC in Table 4 is driven by AFTER×SOLVED_CSRC2 (shareholders’ meeting), AFTER×SOLVED_CSRC4 (management’s responsibilities), and AFTER×SOLVED_CSRC8 (miscellaneous governance problems). Because we use both OROA and Tobin’s Q to proxy for net shareholder value, we examine the regression results of both OROA and Tobin’s Q to draw inferences. We find no consistent evidence across the two regressions that correcting any individual categories of corporate governance noncompliance problems improves shareholder value. Specifically, the coefficient on AFTER×SOLVED_SELF8 (the miscellaneous category) is significantly positive for the OROA regression but insignificant for the Tobin’s Q regression. Likewise, the coefficient on AFTER×SOLVED_CSRC2 (shareholders’ meeting) is not significant for the OROA regression but significantly positive for the Tobin’s Q regression. We also find no consistent evidence suggesting that correcting any individual categories of corporate governance problems reduces shareholder value. Specifically, the coefficients on AFTER×SOLVED_SELF6 (management’s compensation and accountability), AFTER×SOLVED_CSRC7 (corporate disclosure), and AFTER×SOLVED_SELF8 (the miscellaneous category) are significant in either the OROA regression or the Tobin’s Q regression but not both. Interestingly, the coefficients on AFTER×UNSOLVED_SELFi (i=6 for management’s compensation and accountability, 7 for corporate disclosure, and 8 for the miscellaneous category) are significantly negative in the Tobin’s Q regression. Taken at face value, these coefficients suggest that the listed firms’ self-reported corporate governance problems related to these three categories are new to the stock market and thus result in a significant reduction in Tobin’s Q after the revelation of these uncorrected problems. However, we caution the reader to interpret these coefficients with caution because the majority values of UNSOLVED_SELF are zero.
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