Corporate Board Structure in China and Eastern Europe: A Comparative Analysis

Abstract

In this study, we use a large firm-level dataset to explore the structure of the corporate boards of listed and unlisted companies in China and Eastern European countries. It is found that, with the exception of East European listed firms, these economies have problems with corporate governance systems, with the majority of directors appointed internally and the resulting weak presence of outside directors on the board when compared to advanced economies. Furthermore, our empirical analysis of the determinants of board structure reveals that Chinese and Eastern European firms are likely to organize their boards of directors according to the economic logic that has been repeatedly verified in advanced economies. Simultaneously, however, we also find striking differences in the combination of factors that strongly affect board structure between China and Europe and between listed and unlisted firms.