Executives' Political Participation And Corporate Performance In Private Listed Companies

The executives' political participation of private listed companies means that the company's executives are elected as deputies to NPCs or members of CPPCCs.As the development of private economy,private executives increasingly want to gain a say in the political field and pay more attention to establishing a close relationship with the government.However,it is impossible that every private executives can get an opportunity to participate in politics.The existing literature only makes theoretical arguments about the factors that impact executives on political participation but hardly empirical research,especially for the private listed companies.In recent years,although there have been many studies on the influence of political participation on corporate performance,the time for executives to participate in political has not been recorded.So it cannot truly reflect the influence of political participation on corporate performance during executives are in office.In order to make up for the insufficiency of the existing research,this paper conducts further research on the issues between political participation and corporate performance,explores the factors that affect the successful selection of NPCs and CPPCCs,and further analyzes whether the executives' political participation after the election improve the performance of the company.This article takes the "pure" private listed companies whose executives were elected as NPCs or CPPCCs for the first time in 2008 as the research object by collecting data on the time when executives were elected as NPCs or CPPCCs for the first time and tenure time when executives work in the company.Taking the election year as the time node,using Logit regression to study the impact of potential factors on the successful election of the executives as NPCs or CPPCCs,and studying the influence of different level of political participation on corporate performance.The conclusions show that:(1)it is influenced by many factors that the private executives are elected as deputies to NPCs or members of CPPCCs.The company's past performance,charitable behavior,tax payment,and executive's identity of the association can significantly increase the likelihood that the private executives are elected as NPCs or CPPCCs.(2)the political participation(level)of private executives has a significant positive relationship with corporate performance in the first three years during the term of office,which shows that the political status of the company's executives has significantly improved the corporate performance,and the higher the level,the higher the corporate performance.However,in the last two years during the term of office,the political status had no significant effect on corporate performance.According to(1)and(2),it can better explain that the private executives are elected as NPCs or CPPCCs because of the remarkable corporate performance and important contributions to the economy and society,which in turn helps improve corporate performance.