Dec 2013, Volume 7 Issue 4

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  • research-article
    Chengde You, Jianqi Zhang, Xi Li, Wenwen An

    Whether market- and guanxi-based strategies are complementary or substitutable in shaping adaptive capability is a critical yet controversial issue. This paper tackles this problem by adopting the ambidexterity perspective. Specifically, using a sample of 185 Chinese private firms, this study examines the independent and interactive effects of market orientation (MO) and guanxi orientation (GO, i.e., emphasizing on building business and political ties) on adaptive capability of firms in transition economies. Our results suggest that both direct impacts and complementary impacts of MO and GO strongly exist in shaping firms’ adaptive capability, indicating the importance of “strategic ambidexterity.” These findings have several theoretical implications for studies on ambidexterity and adaptive capability, and practical implications for firm strategies in transition economies.

  • research-article
    Xiaohua Su

    The evidence about how entrepreneurial orientation (EO) affects firms’ performance remains inconclusive. This study joins the research by incorporating organizational learning (OL) as a micro-macro link and by extending empirical work to the largely underexplored context of Chinese high-tech industries. Results from a survey of 252 Chinese high-tech firms demonstrate: (1) entrepreneurial orientation is positively related to firm performance; (2) organizational learning is also positively related to firm performance; (3) organizational learning partly mediates the positive impact of entrepreneurial orientation on firm performance; and (4) high-tech companies in the start-up and growth stage are likely to demonstrate stronger linkages in the EO–OL–performance relationship than in mature stage, which shows that the EO–OL–performance relationship is moderated by firms’ life cycle.

  • research-article
    Rongli Yuan, Liming Chen, Wen Wen

    Using propensity score matching (PSM) and the difference-indifference (DID) approach, this paper explores the characteristics of listed Chinese firms that voluntarily disclose auditors’ reports on internal control and the economic consequences. Using a sample of non-financial firms listed on the main boards of the Shanghai Stock Exchange and the Shenzhen Stock Exchange between 2006 and 2010, we find that firms are more likely to voluntarily disclose their auditors’ reports on internal control if they have higher state ownership, lower managerial ownership, sanction records, audit committees, non-Big Four auditors as their auditors of annual financial reports, unqualified auditors’ opinions on financial reports, less board independence, after controlling for firm size, liabilities, performance, and history. Moreover, as compared to a control group that exhibits similar characteristics, firms that voluntarily disclose auditors’ reports on internal control are associated with positive earnings quality and negative cost of equity capital.

  • research-article
    Tingting Zhou, Xing Wang

    This study investigates risk reporting practices of Chinese listed manufacturing companies. More specifically, it empirically examines the relationship between the percentage of institutional shareholding, the disclosure of risk related information and the impact of risk disclosure on internal control and firm risk. Three risk disclosure attributes indicative of good risk related information disclosure are employed in this research. As hypothesized, we find that firms with higher institutional ownership provide more informative disclosure on distinct risk factors and take more actions in response to the risk factors. Results drawn from the potential benefits of risk reporting suggest that risk disclosure has positive effects on the quality of internal control. We also find that risk disclosure can effectively decrease future downside systemic risk.

  • research-article
    Hongli Wang

    This research explores knowledge sharing behaviors, aiming at developing good knowledge governance (KG) mechanisms and promoting university-industry ring phenomenon in China. Empirical evidence concerning the operation of KG, collected through interviews and relevant documentary materials, is analyzed through the lens of communities of practices (CoPs) approach to situated learning. Our case study lends support to the conceptualizing process of KG, in which task design, quality control, innovative capitalists, and relational intellectual property serve as KG mechanisms for promoting university-industry collaboration. In addition, our analysis highlights the significance of associates’ roles in KG for facilitating knowledge sharing behaviors. This research provides empirical evidence for understanding KG in university-industry collaboration.