Global Journal of Management and Business Research, A: Administration and Management, Volume 22 Issue 8

Wholesale & Retail 780 145 36.94 34.12 31.36 21.55 33.31 Heavy Industry & Machinery 1798 401 44.14 36.85 33.96 33.32 37.37 Media & Publication 197 60 52.14 46.03 39.78 38.08 44.49 Communications & IT 911 227 43.36 30.04 28.64 31.15 31.91 Electrical Equipment 1280 301 35.73 36.65 33.01 36.16 34.50 Integrated & Mixed 497 102 30.57 28.41 29.00 00.00 28.77 Table II presents the summary statistics of ownership concentration for 19 industries for each type of public listed company. SOECG refers to the mean percentage of the largest shareholders’ equity ownership in companies for each industry, where the largest shareholder of the company is affiliated with the central government. SOELG refers to the mean percentage of the largest shareholders’ equity ownership in companies for each industry, where the largest shareholder of the company is affiliated with a local government. PRIVATE refers to the mean percentage of the largest shareholders’ equity ownership in companies for each industry, where the largest shareholder of the company is controlled by a natural persons (private investor). ALL the companies referred to as SOECG, SOELG, and PRIVATE are listed on China’s main boards through the Shanghai and Shenzhen stock exchange markets. PCHINEXT represents the mean percentage of the largest shareholders’ equity ownership in public firms whose identity cannot be specified. b) Measuring Operating Performance Data relating to financial measures and employment are collated from the CSMAR Database. Following Dewenter and Malatesta (2001) and Chen et al. (2009), the proxies for the performance measures adopted in this study are ROA, CFOA, OCS, SPROD, and Tobin’s Q. Return on Assets (ROA) is equal to operating income 9 Table III reports the list of dependent and independent variables used in this study and also their estimation method. divided by total assets. Net cash flows to total assets (CFOA) is equal to net sales minus the cost of goods sold, minus selling and administrative expenses, minus tax expenses plus net debt repayment plus depreciation plus amortization expenses plus net borrowing divided by total assets (Ghosh, 2001; Chen et al., 2009). Operating costs to total sales (OCS) is equal to the direct cost of goods plus selling and administrative expenses divided by total assets (Chen et al., 2008). Sales per employee (SPROD) is equal to net sales divided by the number of employees. Tobin’s Q is the performance measure and is equal to the market value divided by total assets. ROA and CFOA reflect on a firm’s accounting income and cash flow, respectively. CFOA is also used as a scalar to reveal firms’ operating cash flow. To investigate the operating efficiency of listed companies, this study uses operating costs to sales (OCS) as a proxy for a firm’s efficiency. Shleifer (1998) argued that state-owned firms tend to suffer from overstaffing and low productivity problems. Consequently, we use the ratio of net sales to the number of employees (SPROD) to capture the effect of productivity. Tobin’s Q is the market measure. 9 Since net income is prone to manipulation in China, we have used operating earnings instead (Chen et al., 2008). The Relationship between Ownership Identity, Ownership Concentration, and Firm Performance: Evidence from China 16 Global Journal of Management and Business Research Volume XXII Issue VIII Version I Year 2022 ( ) A © 2022 Global Journals