Performance Indicators And Monitoring The Influence Of Corporate Governance Decisions

For most firms, the initial public offering (IPO) is often the first event in their history in really separating ownership from control. The owners are needed to make decisions on how to inspirit and control the managers, which depend on rational corporate governance. Therefore a right corporate governance mechanism is very important to the IPO firms. Whereas this, it is necessary to study the influence factors for the IPO firms to use for reference and for other public ones to consult.This paper analyzes corporate governance decisions at firms making initial public offerings (IPO) of common stock between 1998 and 2001. The objective is to examine relations between firms' corporate governance decisions and the informativeness of available measures of managerial performance. I consider financial measures such as earnings and stock return, as well as direct monitoring. I collect a sample of IPO firms from the manufacturing, electrommunication and biomedicine industries, and examine how the use of various performance measures in annual compensation grants and turnover decisions varies with the information environment of the firm and with the extent of state ownerships influence. The result of demonstration indicates that the practical cases are widely different with the theoretics. So it is urgent affair for our public company to improve the governance decisions for the future.