政治联系与公司价值

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摘要：通过对很多公司调查研究，我们发现私企的政治联系可以增加公司价值。本文通过对万向集团的研究，讨论公司高管的政治联系与公司价值的关系。

关键词：政治联系 公司价值 万向集团

Abstract：Using a survey conducted by previous researcher， we find political connections are prevalent among private firms and political connections can help private firms to obtain loans from banks or other state institutions. Further， in this paper，We use a specific private firm named Wanxiang Group as an example to discuss how the executive with political background increases firm value.

Key words： Political connection；Firm value；Wanxiang Group

1.Introduction

Political connection （PC） has been a hot topic for many years and the value of political connections to firms aroused considerable research interest. There are many researches from abroad indicating that the firms’ executives with political backgrounds as a firm’s characteristic. Fishman （2001） found that political connection is a valuable resource to firm. Johnson and Mitton（2003）、Faccio（2006）、Adhikari，Derashid and Zhang（2006） find political connections can enhance firm value through easier access to debt financing， etc. Even in the U.S which has strong and well-functioning legal system， anecdotal stories about the influence of political connections to firms do exist.Political connection is prevalent all over the world， let alone in China. Due to the lingering legacy of command economy and slow development of market economy， the ultimate control of most resources is owned by the government. For private firms， particularly， due to the non-state status and socialist ideology， they face many obstacles in business . Consequently， political connections play a significant role in firm value.

2.Institutional background ―― Chinese private firms

When the Communist Party won the Civil War and founded the PRC in1949.The whole country began the socialist transformation， thus， the private firms were completely banned between 1952 and 1977. Since Deng Xiaoping's Southern Tour of 1992， private business has made a large progress. One of the most significant changes in the development of the private sector since 1978 occurred in March 2004， when the National People's Congress approved a constitutional amendment to protect private property rights. The change in political sentiment toward private firms also encouraged many Party members to start their own businesses，which is vividly described as “plunge into the sea” （xiahai）. While they enter business area， they also keep in touch with government officials. Close and continuous connections with the Party and the government officials provide “xiahai” entrepreneurs certain advantages. Meanwhile， many private entrepreneurs want to improve their own political status， like being a member of NPC， so that they can easily gain scarce resources which can create more value to firms.

3.Case Study

We use a specific Chinese private firm called Wanxiang Group to study how the chairman Lu Guanqiu with political status as a member of National People’s Congress creates value to his firm.

Wanxiang Group， formerly a farm machinery repair factory， was originated in 1969.Guided by the founder Lu Guanqiu ，Wanxiang has been a large private enterprise with sales of more than twenty billion and profit of over one billion up to 2004.The president Lu Guanqiu is not only a famous entrepreneur， but also a member of the National People’s Congress. With the improving political status of him， his firm’s value has also been enhanced in leaps and bounds. Wanxiang Group went public in Shenzhen Stock Exchange in 1993，which is among the earliest listed private companys in China. Wanxiang Group established a non-bank financial institution called Wanxiang Finance Company in 2001， which extends to the area of finance. In 2002， China Insurance Regulatory Commission approved the establishment of Minshen Insurance .In 2003， Wanxiang group received government approval of purchasing additional stakes， becoming the trust institution's largest shareholder .In November 2005， Wanxiang Group became the first company allowed to issue enterprise bonds of private enterprises in a short span of a few years.

Entrepreneur’s political identity play a role of signal transmission and reduce the effect of information asymmetry. This is because， the private entrepreneurs get such as the NPC and the CPPCC member of political identity， on the one hand， it shows that the enterprise has considerable economic strength and scale； On the other hand， shows the corresponding private enterprise for economic development has made the contribution to the society and the government for approval. Bank loan officer and state public servants to the private enterprise loans and industry access qualifications， facing the possibility of rent-seeking question， is greatly reduced. In this sense， the private entrepreneur’s political identity plays a transfer enterprise quality signal function， helping enterprise get extra development opportunities and promoting the development of private enterprises . Under the administrative control condition， the political status of the private entrepreneur can benefit the firm from lowing the barrier by conveying the signal of the firm’s quality， which will enable the firm to get more financial resources.

4.Conclusion

This paper explores the positive role political connection plays in the firm value. Despite the transformation from command economy to market economy， the private enterprises still face lots of obstacles due to their ownership. Private firms not only experience political discrimination， but also suffer unfavorable economic environment. China’s market institutions are far from perfect and are likely remain for a long time， and thus political connections can largely affect private firms’ value. Due to the ultimate government control of most resources， particularly to private firms， political connections seem very important. By analyzing the Wanxiang Group as an example， we can significantly find that under the government control condition， the political status of the private entrepreneur can benefit the firm from lowing the barrier by conveying the signal of the firm’s quality， which will enable the firm to get more financial resources. The president’s political background creates large profit to Wanxiang Group. Therefore， executives’ political status can facilitate the development of the private firms.However， we acknowledge that our paper is still subject to several caveats. First， the definition of political connection in this paper could not fully cover the firms’ political relationship with the government .Second； we could not get the direct data.

References：

[1]Fisman，R.，2001.Estimating the value of political connections.American Economic Review 91，1095-1102

[2]Johnson，S.，Mitton，T.，2003.Cronyism and capital controls：evidence from Malaysia.Journal of Financial Economics 67，351-382

[3]Faccio，M.2006.Politically connected firms.American Economic Review 96 （1），369-386

[4]Adhikari A.，Derashid C.，Zhang H.，2006，Public Policy，Political Connections，and Effective Tax Rate：Longitudinal Evidence from Malaysia，Journal of Accounting and Public Policy 25，574-595

[5]See .cn