TABLE A1.
Definition of variables.
| Variables | Definition |
| Roe | Net profit/shareholders’ equity at the end of the year |
| CC | Total sales amount of the top five customers/total sales amount of the year |
| Ability | Calculated using DEA–Tobit model developed by Demerjian et al. (2012) |
| Size | The natural logarithm of total assets at the end of year |
| Grow | The growth rate of operating income |
| Lev | Total debt/total assets |
| First | The share percentages held by the largest shareholder |
| Age | The natural logarithm of the firm’s listing year plus one |
| Tangible | Net fixed assets/total assets |
| Indd | The proportion of independent directors on board |
| State | A dummy variable that equals 1 if the firm is controlled by the state, 0 otherwise |
| Board | The natural logarithm of total number of directors |
| Mb | Total assets/market value |
| Pay | The natural logarithm of total monetary compensation |
| Separation | Proportion of ownership of actual controller/proportion of control rights |
| Cf | Net cash flow from operating activities/total assets at the end of year |
| Ms | The percentage of revenues earned by the firm within its industry |
| Fcf | A dummy variable that equals 1 if the company has positive free cash flow, 0 otherwise |
| Bsc | 1−Σpi2, pi is the proportion of industry i income in main business income |
| Oos | A dummy variable that equals 1 if the company has overseas subsidiaries, 0 otherwise |