Personnel Power: Governing State-Owned Enterprises

State-owned enterprises (SOEs) retain a strong presence in many economies around the world. How do governments manage these firms given their dual economic and political nature? Many states use authority over executive appointments as a key means of governing SOEs. We analyze the nature of this “personnel power” by assessing patterns in SOE leaders’ political mobility in China, the country with the largest state-owned sector. Using logit and multinomial models on an original dataset of central SOE leaders’ attributes and company information from 2003 to 2017, we measure the effects of economic performance and political connectedness on leaders’ likelihood of staying in power. We find that leaders of well-performing firms and those with patronage ties to elites in charge of their evaluation are more likely to stay in office. These findings suggest that states can leverage personnel power in pursuit of economic and political stability when SOE management is highly politically integrated.

“It’s being a part of a grand tradition, a grand counter-culture which involves communities”: A qualitative investigation of autistic community connectedness

Autistic people report experiencing greater comfort socialising and easier communication with other autistic people compared to with non-autistic people. Despite autism being stereotypically associated with a lack of social motivation or community, an autistic community has been described briefly in the literature but is not yet well understood. Autistic community connectedness (ACC) may play an important role in promoting and protecting wellbeing for autistic people. This qualitative study involved interviewing autistic individuals (N = 20) in-person, via a video-based platform, over a text-based platform, or over email (according to the needs of the participants) to investigate ACC. Critical grounded theory tools were used to collect and analyse the data. Three elements of ACC were apparent in the data: belongingness, social connectedness, and political connectedness. Belongingness referred to the general sense of similarity that autistic people experienced with other autistic people, which they often did not with non-autistic people. Social connectedness referred to specific friendship participants formed with other autistic people. Political connectedness referred to a connectedness to the political or social equality goals of the autistic community. Participants described the benefits of ACC as being increased self-esteem, a sense of direction, and access to a sense of community that they did not typically experience with non-autistic people. Lack of connectedness involved ambivalence with an autism diagnosis and/or feelings of internalised stigma. These experiences of ACC may have implications for autistic people’s health and wellbeing, as well as how they deal with exposure to discrimination and stigma.

Director Networks, Political Connections, and Earnings Quality in Malaysia

This article investigates the relationship between director networks and earnings quality in Malaysia. Using data on 4,416 individual directors who served on the boards of 745 firms listed on Bursa, Malaysia during 2011, we map the entire network of directors and generate measures to reflect the size and quality of information within the network. We find a negative and significant relationship between the overall connectedness of a director's network and the firm's earnings quality. In addition, we find a negative and significant relationship between the political connectedness of the director's network and earnings quality. Our results are robust for different measures of earnings quality.

Does political connectedness determine stock returns in Indonesia?

This study aims to investigate the influences of political connection on stock returns in Indonesia. We develop a comprehensive database of firm-level political connectedness among Indonesian firms from 2010 to 2017. Our sample is non-financial Indonesian listed firms that are selected in the Kompas 100 index for 16 consecutive periods, with a total of 448 firm-year observations. This study employs panel data regressions to estimate this relationship, then mitigate possible endogeneity issues using two-stage least square with fixed-effects. The finding of this study shows that political connectedness is associated with lower stock returns, more prominently in agriculture and consumer goods industries. Moreover, state-owned enterprises are more likely to earn lower stock returns. In summary, our result suggests that investing in politically connected firms could be a risky investment. The finding holds using alternative estimation methods

Moroccan Cronyism

This chapter looks at cronyism as a pillar of Morocco’s political economy and studies its manifestation and impact in the manufacturing sector. Cronyism and patronage have helped the Makhzen to strengthen its control on Moroccan society and prevent any countervailing power from taking root, especially in the economic sphere. After Morocco became independent, the state–business nexus was consolidated through “Moroccanization,” import-substitution strategy, and privatization. The network of cronyism and patronage was reinforced and extended during the liberalization era. This chapter uses a unique database to identify politically connected firms and measure their performance in comparison with non-connected ones. Political privileges are granted to connected firms through preferential access to finance, protection from foreign competition, and discriminatory implementation of rules and regulations. This chapter also provides some illustrative evidence showing that political connectedness tends to impede firms’ dynamics and innovation.

Firm Performance, Ownership Structure, and CEO Selection

This paper attempts to examine the effect of ownership structures, corporate performance and board political connectedness on CEO selection. The sample of the study is all Nigerian non-financial firms from the year 2011 to 2015 consisting of 72 CEO selection events. This study uses logistic regression analysis to provide evidence that firms dominated with blockholder ownership favour external successors while managerial ownership-controlled firms are inclined to select internal candidates as successors. However, this study fails to support the argument that corporate performance and board political connectedness do influence the choice of CEO selection in the Nigerian public listed companies. In sum, the findings suggest that blockholders and managerial ownership significantly influence the choice of the origin of the successor CEOs in the Nigerian corporate landscape. This paper enriches the literature about CEO selection choices in developing economies with weak corporate governance structure like Nigeria. In addition, the findings from this study could be of immense benefit to the shareholders and corporate board members in making a decision on recruiting their CEOs; and the regulatory agencies in the formulation and enforcement of reforms that guarantee good corporate practices by the boards.