In a Scandal, Shareholders, Not Citizens, Are the First to Know – WSJ
Investors have been kept in the loop, analysts say, because the companies – including toll-road operator Fuxi Investment Holding, manufacturer Shanghai Electric Group, property developer New Huangpu Real Estate and investment firm Hua An Fund Management – have complied with regulatory guidlines by notifying investors that their top executives were under investigation, even as the government itself kept silent.
Chinese companies “used to need a long time before telling the truth, and eventually the listed companies only told a little of the truth,” says Zhang Qi, an analyst at Haitong Securities in Shanghai. “Now they are quicker.” …
The scandal isn’t the first time that disclosure requirements for listed companies have taken the lid off alleged corruption in China. In 2003, statements from Hong Kong-listed Shanghai Land Holdings provided a source of information about the politically charged downfall of its controlling shareholder, Shanghai property magnate Zhou Zhengyi. [full text not yet available]
- CDT’s coverage on Chen Liangyu