An Empirical Study of Corporate Turnaround Determinants on Chinese Small Companies

The overall objective of the study is to investigate the determinants of corporate turnaround in China. Based on Chinese economic environment, we analyze the determinants of strategic turnaround that took place in small companies and present an empirically supported model proposing that turnaround situations and actions (operational improvement and strategic reorientation), organizational context (stakeholders, board control and etc.) and environment context decide the outcome of the turnaround process. The result of multivariate logistic regression indicates that the changes of the CEO, the industry structural problems, the substitute of the board members, net organizational capital (NOC) and the change of strategy can be helpful in explaining turnaround.