Dr Sammy Ying

We adopt a principal¿principal perspective to examine whether comment letters for mergers and acquisitions (M&A) protect shareholders, particularly minority shareholders, of acquiring firms in China, where investor protection is weak. This public enforcement tool has several features: (i) regulators provide detailed comments on various matters, (ii) various stakeholders are called upon to respond, and (iii) failure to adequately address the comments to the satisfaction of regulators results in M&A applications being rejected. Our main results show that M&A comment letters affect the outcome of M&A transactions by reducing acquisition premium and improving the fulfillment of performance commitment. Furthermore, this effect is more pronounced when the principal¿principal conflict is more severe, as indicated by a greater divergence between cash flow rights and control rights, along with weaker monitoring by multiple large shareholders. Our results suggest that M&A comment letters, if used appropriately, effectively enhance investor protection in less developed economies. We contribute to the literature by providing new evidence of the effects of M&A comment letters in settings with weak investor protection.

Climate policy is of great importance for China's climate goals of achieving peak carbon emissions by 2030 and carbon neutrality by 2060. However, whether the climate policy can consider economic performance and achieve high-quality economic development remains to be tested. Based on the perspective of high-quality economic development, this study takes three batches of low-carbon city pilots in China as a quasi-natural experiment and uses time-varying difference-in-differences to examine the impact of climate policy on high-quality development of enterprises. The findings show that the current climate policy in general does not promote the high-quality development of enterprises, when comprehensively considering the gradually strengthening regulation intensity of pilot policy in batches. The result holds after a battery of robustness tests. Further analysis shows that the economic mechanism behind it lies in that the environmental regulation arising from the climate policy only triggers the "compliance costs effect" instead of the "innovation offset effect." It also finds that the inhibition effect of climate policy on high-quality development is more pronounced for non-state-owned enterprises, small-scale enterprises, and the sample with strong local environmental law enforcement. The findings of this study would complement existing theoretical research via evaluating the effectiveness of China's current low-carbon policy at the micro level and provide policy implications for the implementation of future climate policies so as to mitigate climate change and achieve high-quality economic development. In addition, our estimation strategy can serve as a scientific reference for similar studies in other developing countries.

China, the world's largest emerging economy, has been under enormous pressure to combat environmental challenges. In response, the Chinese government has implemented a series of cleaner production standards (CPSs) to address pollution issues. Taking advantage of the staggered passage of 56 CPSs during the period 2003¿2010, this study uses a difference-in-differences research design to investigate how environmental regulation drives corporate environmental responsibility. The results show that, following the passage of a CPS, firms in regulated industries exhibit a significant improvement in both green investment and green innovation, indicators of corporate environmental responsibility. Moreover, the effect of CPSs is strengthened by pressure from key stakeholders ¿ institutional shareholders and large customers, and also by two market conditions, namely product market competition and financial market development. The findings have important policy implications and suggest that coercive regulatory forces and market forces can reinforce each other to improve the effectiveness of environmental regulations.