Raymond Siu Yeung Chan

The Counselling Self-Estimate Inventory (COSE): does it work in Chinese counsellors?

Counselling self-efficacy is an important construct for research and evaluation in counsellors’ competencies and training effectiveness. Larson et al. developed the Counselling Self-Estimate Inventory (COSE) for counsellors in America and examined its factor structure using exploratory factor analysis. They recommended a five-factor model (microskills, counselling process, difficult client behaviour, cultural competence, and awareness of values) and the use of the COSE for future research. However, little research has investigated the validity of the COSE in the context of counselling Chinese students in schools. In the present study, the factor structure of responses to the Chinese version of the Counselling Self-Estimate Inventory in a sample of 578 Hong Kong secondary school guidance teachers was examined using the EQS approach to confirmatory factor analysis. The results showed that while a five-factor model was fairly able to fit the data, the deletion of items related to the awareness of values factor yielded a better fitting model. The discussion of potential uses and limitations of the C-COSE in the context of preparing and supervising school guidance personnel in student counselling is relevant to counselling psychologists and researchers in Hong Kong and other parts of the world.

Compliance and value relevance of audit committees: evidence from Hong Kong

Purpose - Audit committees (ACs) have been perceived as an important means of corporate governance, safeguarding the interests of shareholders by monitoring internal control and risk management. This study aims to examine specific structural and operational characteristics of ACs for firms in Hong Kong, where regulators have strived to adhere to international compliance standards. Design/methodology/approach - This study is based on a cross-sectional examination of disclosures on ACs by 223 listed companies in Hong Kong. Findings - The independence and financial expertise of AC members do not enhance the value of the respective firms, despite maintaining satisfactory compliance. The discrepancy in the value relevance of ACs in prior studies is explained by the possible inadequacy of the resources available to ACs. Research limitations/implications - The data in this study are entirely from secondary sources of disclosures by listed companies for the year immediately following the implementation of the code of best practices of corporate governance. No in-depth case studies are supplemented. Practical implications - A key implication of this study to the regulators is that the proper allocation of resources to an AC should be considered beyond the independence and financial expertise of AC members to ensure the effectiveness of an AC. Originality/value - This paper is an empirical study about the practices and compliance of ACs among listed companies in a global financial centre.

Youth Opinions about the Ex-Mentally Ill in Hong Kong

Community care has been adopted as the principal service delivery strategy to various target groups, especially the mentally ill, in Hong Kong. The success or failure of community care services dep...

Is Debtor-in-Possession Viable in Hong Kong?

In October 2009, the Financial Services and the Treasury Bureau of the Hong Kong Government published a consultation paper to review corporate rescue procedure with the aim of reforming key issues relating to corporate rescue. This paper compares the proposed reform in Hong Kong and the debtor-in-possession concept of the United States of America in Chapter 11 corporate rescue, and seeks to identify the reasoning behind the differences.

How Ownership Structures Affect the Relations between Product Market Competition, and Pay-Performance Sensitivity

For decades, humans have been consuming large quantities of oil, coal and natural gas. Consequently, people must now take responsibility for having participated in productive activities that have caused the emissions of greenhouse gas (GHG) which has damaged the environment and caused problems associated with abnormal weather. Previous studies investigated the relationships between energy and carbon prices, between oil price and stock index, or between carbon price and macro-economic factors. Few have examined the relationships among EUA spot price, oil price and the stock index in individual nations. Owing to the fact that the European Emissions Trading Scheme (EU ETS) is the worlds first carbon market and remains the largest globally, this study, based on the finding of Chevallier (2009) that capital markets are closely related to the commodity markets, examines the long-term equilibrium relationship and causality among European Union Allowance (EUA) spot price, Brent oil price and three European major stock indices from January 1, 2005 to Dec. 31, 2012. The sample period is further divided into three sub-periods of 2005 to 2007 (Phase 1 of the EU ETS), 2008 to 2010 (US subprime loan crisis and the first period of Phase 2 of the EU ETS), and 2011 to 2012 (European debt crisis and the second period of Phase 2 of the EU ETS). Numerous notable findings from the empirical findings are presented. First, EUA spot price, oil price and DAX index are co-integrated with each other during the second sub-period. Although oil price can be adjusted to the long-term equilibrium in German stock market during that period, adjusting EUA spot price to long-term equilibrium is rather difficult. Next, oil price is affected by EUA spot price unilaterally for the full sample period and the third sub-period. Moreover, EUA spot price is unaffected by any factor except itself during the first sub-period, and is affected by three European stock indices for the full sample period, and the third sub-period. Furthermore, the most explanatory power for Brent oil and EUA spot prices arises from themselves, respectively. Finally, the capital markets and commodity markets are closely related during the 2nd sub-period only.

Dividend Policy and Investment Efficiency -- The Changes of the Mandatory Dividends Payment

This paper demonstrates important interactions between dividend policy and investment efficiency. We find that dividend payout can improve investment efficiency, especially can mitigate over-investment. Prior research shows that dividend payout help mitigate over-investment problem (Biddle, Hilary, and Verdi, 2009). However, firms with low investment discretionary may be maturer, have rich cash flows, and prefer to issue dividends. We use a setting to solve this problem. In 2006, China Securities Regulatory Commission (CSRC) issues documents and declares that firms need to issue at least 20% of their net profit as cash dividends accumulatively in continuous three years before refinancing. In 2008, this rate increases to 30%. We find the negative effect of dividend on over-investment is more significant after 2006. Because this regulation is associated with refinancing, we use cross-sectional analysis to compare firms with and without refinancing activities. This can exclude the effect of the macroeconomic factors and other regulation factors. We find that firms with refinancing activities have negative effect on the depressant effect of dividend payout on over-investment. This effect is more significant after 2006. This mitigating effect is mainly affected by the shock in 2006, when the refinancing activities are first linked to a certain amount of dividend payments. Besides, we also find that the larger size of refinancing, the more negative effect on the depressant effect of dividend payout on over-investment is. Larger size of refinancing means that firms are more likely to have larger investment projects. Those kinds of firms really need cash to catch the investment opportunities. At that time, CSRC asks them to issue at least 20% of net profit as cash dividends can attenuate the over-investment more pronouncedly. These policy events provide exogenous shocks, which can attenuate the endogeneity concern. Our finding is consistent with prior the research (Biddle et al., 2009). It is robust when we use different model to estimate investment residual and after other robust tests. After analyzing, we can conclude that dividend payout can alleviate over-investment.

Could Complying with China's Secrecy Laws Be an Excuse for Auditors not to Provide their Working Papers of Auditing Chinese Companies? Recent Cases in the United States and Hong Kong

Western companies, professionals and regulators new to handling matters involving the Peoples Republic of China (PRC) often learn that the legal instincts developed in their home countries cannot ...

Media Coverage of Corporate Governance Scandals and Stock Market Returns

The media plays an important role in corporate governance (CG) as corporate monitors, especially for listed companies, by uncovering corporate malpractices to the knowledge of investors. In addition to being greeted with dumping their stocks in the markets, negative media attention damages managers’ and directors’ reputations, and can reduce the value of these individuals in the labor markets. Media attention on firms with weak CG can also drive politicians and regulators to enact legislation to reform or enforce corporate law. The latter is exactly the situation in the United States (US) where an immediate legislative response in the Sarbanes-Oxley Act in the wake of a number of large corporate frauds at the turn of the new millennium, such as the cases of Enron and Worldcom, which had shocked the investing community in the US as well as around the world. Some of these corporate frauds cases were in fact first discovered by the media well before regulators took actions to investigate into the cases. The share prices of these corporations plummeted as a result of media reporting. There is no exception for Hong Kong (HK), where media attention to large corporate frauds has also drawn negative sentiments from the investing public. Although the HK government and regulatory bodies did not respond with imposing dramatic reforms in securities or corporate laws to protect investors similar to the US, they are tightening the CG requirements on HK listed corporations in the recent decade similar to other governments around the world. Research on media attention on corporate frauds up to now focuses mainly on the US markets, but little is known about their effects on investors in Asia, particularly in HK, a major financial centre in the region and a primary capital market for mainland corporations to seek funding overseas in recent years. This study intends to fill this gap in the research. The research objective of this study is to investigate the impact of media coverage of CG scandals among HK listed companies on their stocks. The questions addressed in this study are whether the impact of media coverage of large corporate frauds on investors in HK is similar to that in the US in terms of magnitudes of the stock returns and stock volumes of these companies relative to those of the market as a whole? Whether this negative impact, if any, is short-term or long-term? What are the characteristics of these firms that may account for the greater impact on their stocks?