ABSTRACT
This chapter explores the impact of corporate governance in two emerging markets China and India dominated by a few large business groups. It provides a brief overview of growth in China and India and the opening of their economies to the world. The chapter examines the sources and the evolution of corporate governance, focusing on reforms and structural changes in both countries. In China, according to the National Statistics Bureau of China (NSBC), a business group consists of legally independent entities that are partly or wholly owned by a parent firm and registered as affiliated firms of that parent firm. The State Administration for Industry and Commerce (SAIC) provides a more quantitative definition: to become a business group in China, the core company should have the register capital of over 50 million yuan and at least five affiliated companies. Public sector enterprises (PSEs) were formed after India independence and specialized in heavy industries to support Indian economic growth and development.
