In a Scandal, Shareholders, Not Citizens, Are the First to Know – WSJ

 Financial Jingji Sanji Toutiao New 20021021 108 4 ChenshizhangAnother perspective, and hint, about how journalists and China watchers may start looking at, or into, potential scandals or corruption cases, from deep inside the Wall Street Journal today:

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

November 14, 2006 10:30 AM
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Categories: Economy, Politics