Essays on Corporate Finance and Corporate Governance

This thesis includes three essays that examine the effects of firm policies on labor costs, corporate culture, and stock markets. The first essay studies the impact of major customers on supplier firms’ performance, and I find that supplier firms are willing to collaborate with their major customers while keeping low financial leverages. The cooperation with major customers results in higher productivity and strategic alliance, which could explain the reduction in the labor share of supplier firms. In my study, labor share is defined as the ratio of labor costs to total revenue. Compared to firms without major customers, supplier firms with at least one major customer would reduce labor shares on average by 33% in absolute terms. The findings contribute to the growing literature on the global trend of labor share reduction. The second essay examines the effect of market competition on corporate openness, which is a particular aspect of corporate culture. Corporate openness reflects how open firms are when facing new ideas and experiences, and measures firms’ willingness to innovate and cooperate. I conclude that market competition improves firms’ corporate openness through good corporate governance. Furthermore, corporate social responsibility activities are seen as a positive social outcome of corporate openness. As to economic consequences, less open firms would experience stock return reductions when the market competition is high. The third essay studies the firms listed on Chinese stock exchanges that established an internal whistleblowing mechanism. The results show that the employee whistleblowing system prevents firms from misconducting and leads to reduced stock price crash risk. Furthermore, a cooperative corporate culture helps the internal whistleblowing system decrease crash risk, while an unfair organizational climate exerts the opposite influence. Overall, this study contributes to the emerging literature on the governance role of whistleblowing.

Department dc:contributor.department

Business

Year dc:date.issued

2024

Author dc:creator

• Ding, Zijun

Advisor dc:contributor.advisor

• Charupat, Narat

Language dc:language.iso

en

Handle dc:identifier.uri

http://hdl.handle.net/11375/30182

OAI record oai:identifier

https://macsphere.mcmaster.ca/server/oai/request?verb=GetRecord&metadataPrefix=dim&identifier=oai%3Amacsphere.mcmaster.ca%3A11375%2F30182