State Ownership and the Formal-Oversight Paradox: Audit-Committee Adoption and Disclosure Enforcement

<title>Abstract</title> <p> State ownership and audit committees are often modeled as independent governance mechanisms, although firms may organize accountability through different monitoring bundles. Using 2,335 firm-year observations for 467 nonfinancial companies listed on HOSE and HNX that satisfy the study’s governance, ownership, financial, audit, and enforcement-data requirements during 2020–2024, this study separates the extensive margin of audit-committee entry from the intensive margin of committee architecture and links both to subsequent regulator-recorded disclosure enforcement. Among 415 firms without a validated audit committee in 2020, 49 adopted one by 2024. Adjusted cumulative adoption is 5.5% for state-linked firms versus 14.3% otherwise. At the same time, a ten-percentage-point increase in state ownership is associated with approximately 21% fewer expected next-year recorded violations. Observed audit-committee architecture barely attenuates this ownership gradient, and continuing committees do not display a broad state-linked reduction in size, meetings, independence, or expert leadership. Within-firm estimates reverse sign, but identifying variation comes from only two outcome-informative firms whose state share changes. The evidence therefore supports a bounded governance-regime interpretation rather than a causal state-ownership effect: formal board-centered oversight and recorded enforcement can move differently when monitoring is organized through alternative institutional configurations. <bold>JEL Classification:</bold> G34; M41; M42; G38 </p>