Corporate Governance and Market Performance of Seasoned Equity Offerings: Evidence From Chinese Listed A-Share Companies

Abstract

This study examines how corporate governance affects the market performance of seasoned equity offerings (SEOs) in Chinese A-share firms from 1998 to 2001. Using a sample of 458 SEOs, we analyze the role of governance attributes, including state ownership, board structure, independence, and CEO duality, on both short-term announcement effects and long-term stock returns. Results show that state ownership and CEO duality are negatively associated with long-run performance, while board independence enhances outcomes. New share issues elicit more favorable short-term responses than rights offerings. The findings highlight the importance of internal governance mechanisms in influencing investor reactions and capital market performance in emerging economies.