Does the risk of major customer need to be balanced? The role of customer concentration in corporate governance

Di Gao; Jiangming Ma; Yiru Wang

doi:10.1371/journal.pone.0259689

Peer Review History

Original SubmissionJune 2, 2021
3 Sep 2021 Decision Letter - László Vasa, Editor PONE-D-21-18289Does the risk of major customer need to be balanced? The role of customer concentration in corporate governancePLOS ONE Dear Dr. Gao, Thank you for submitting your manuscript to PLOS ONE. After careful consideration, we feel that it has merit but does not fully meet PLOS ONE’s publication criteria as it currently stands. Therefore, we invite you to submit a revised version of the manuscript that addresses the points raised during the review process. Please submit your revised manuscript by 20.09.2021. If you will need more time than this to complete your revisions, please reply to this message or contact the journal office at plosone@plos.org. When you're ready to submit your revision, log on to https://www.editorialmanager.com/pone/ and select the 'Submissions Needing Revision' folder to locate your manuscript file. 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Is the manuscript technically sound, and do the data support the conclusions? The manuscript must describe a technically sound piece of scientific research with data that supports the conclusions. Experiments must have been conducted rigorously, with appropriate controls, replication, and sample sizes. The conclusions must be drawn appropriately based on the data presented. Reviewer #1: Partly Reviewer #2: Yes ******** 2. Has the statistical analysis been performed appropriately and rigorously? Reviewer #1: Yes Reviewer #2: Yes ****** 3. Have the authors made all data underlying the findings in their manuscript fully available? The PLOS Data policy requires authors to make all data underlying the findings described in their manuscript fully available without restriction, with rare exception (please refer to the Data Availability Statement in the manuscript PDF file). 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You may also include additional comments for the author, including concerns about dual publication, research ethics, or publication ethics. (Please upload your review as an attachment if it exceeds 20,000 characters) Reviewer #1: Manuscript discusses interesting topic supported by statistical analyses, but needs improvement. Abstract does not give the research goal directly. It should be reconstructed in my opinion. A clear, simple abstract would attract readers, in this form it is complicated and does not focus on the real goal of the authors. Introduction is too long with its 5 pages. Again, a more simple structure would help. I suggest to visualize conceptual model of the research to clarify. Literature review is good, I suggest to reconsider the hypotheses. Is it important to cut them into A and B parts? They focus on the same thing from the opposite angle. Materials and methods: plain text is too much. Authors should try to visualize the content at least by using listed form. Results: The content of S1 table should be inserted into the text. This table defines the terms which are used in the results chapter. Without that information the content is not clear. The legend for the abbreviations shall be given below the tables. The format of the tables is not clear enough. The conclusions derived from the analyses should be highlighted at the end of the subchapters, at least in a new paragraph. The asterisks , , are very confusing in the tables. Other indication should be used. In the present form it is hard to find what was the aim for conducting the performed analyses. Again, I recommend to add a visualized conceptual model which may help to follow the process of the research, how the analyses lead us to the new results. Conclusions: must be broadened. It says: "We empirically document that an inverse U-shaped curve exists between customer concentration and corporate risk-taking." Yes, but it is not highlighted in the results. Please show it. It is seen that authors presented a complex research, but the way of presentation must be improved for acceptance. Reviewer #2: The paper investigates the role of customer concentration on corporate governance and how the risks of main customers can influence the company. The study is well written, its structure is perfect (except the keywords which are missing). The abstract is well written, giving a brief highlight of the content in an excellent style. The introduction explains the importance of the topic and introduces the importance and context, supported by some literature sources. The literature review is well based, critical, and analytical enough; the hypotheses are developed in this framework too. The methodology is clearly written, logical. Moreover, the authors selected the appropriate methodological toolset and applied them very well. The methodology well supports the results; the conclusions are based on the results. The language of the paper is scientific enough and well understandable. ******** 6. PLOS authors have the option to publish the peer review history of their article (what does this mean?). If published, this will include your full peer review and any attached files. If you choose “no”, your identity will remain anonymous but your review may still be made public. Do you want your identity to be public for this peer review?** For information about this choice, including consent withdrawal, please see our Privacy Policy. Reviewer #1: No Reviewer #2: No [NOTE: If reviewer comments were submitted as an attachment file, they will be attached to this email and accessible via the submission site. Please log into your account, locate the manuscript record, and check for the action link "View Attachments". If this link does not appear, there are no attachment files.] While revising your submission, please upload your figure files to the Preflight Analysis and Conversion Engine (PACE) digital diagnostic tool, https://pacev2.apexcovantage.com/. PACE helps ensure that figures meet PLOS requirements. To use PACE, you must first register as a user. Registration is free. Then, login and navigate to the UPLOAD tab, where you will find detailed instructions on how to use the tool. If you encounter any issues or have any questions when using PACE, please email PLOS at figures@plos.org. Please note that Supporting Information files do not need this step. https://doi.org/10.1371/journal.pone.0259689.r001
Revision 1
29 Sep 2021 Author Response Response to Reviewer 1 Title:Does the risk of major customer need to be balanced? The role of customer concentration in corporate governance (PONE-D-21-18289) We appreciate the comments and suggestions in your referee’s report, which have helped us to better position the paper. We have carefully revised the paper to incorporate your suggestions. We believe that the incorporation of your suggestions has made significant improvement to this paper. The revised part of the paper is in blue. Below please find our point-by-point responses, with the referees’ original comments shown in italics. And the revised manuscript are attached. Reviewer #1: Manuscript discusses interesting topic supported by statistical analyses, but needs improvement. 1. Abstract does not give the research goal directly. It should be reconstructed in my opinion. A clear, simple abstract would attract readers, in this form it is complicated and does not focus on the real goal of the authors. Response: We are very thankful for this comment. As for the comments, we are sorry that we do not give the research goal directly. In the rewrote Abstract and added more discussions of the research goal related to our topic in Introduction, Result and Conclusion. Please see revised Abstract, on page 1. 2.Introduction is too long with its 5 pages. Again, a more simple structure would help. I suggest to visualize conceptual model of the research to clarify. Response: The referee’s comments are reasonable, and we revised the paper accordingly. First,we reorganized Introduction with 4 pages by abbreviating research contribution. Second, we deleted duplicate similar statements. Third, we added a new paragraph to explain the chapter arrangement and structure. Fourth, we added a figure to clearly clarify the economic logic framework of our research in the revised manuscript, The economic channels or research logic frame is as follows: Fig. 1. Logical diagram of customer concentration effect on firm risk-taking. Please see revised Section 1, on page 2-5,9. 3.Literature review is good, I suggest to reconsider the hypotheses. Is it important to cut them into A and B parts? They focus on the same thing from the opposite angle. Response: Thank you for your thoughtful comments. In the research of economic empirical analysis, some researchers will directly put forward one hypothesis and some will put forward two opposite hypotheses. It is depend on the specific content of the research and literature review. Our research is similar to the latter. Hypothesis A and hypothesis B represent two aspects : null hypothesis and alternative hypothesis. As we have discussed in literature review part, customer concentration has not only positive but also negative effects on enterprises (Certification effect and Concentrated credit risk). In that case it may have a "double-edged sword" effect on firm risk-taking.Therefore, it is more appropriate to write two Hypothesis A and hypothesis B. In addition, our finding "a nonlinear relationship between customer concentration and risk-taking, corporate policies and firm performance" also shows that these two effects exist in China. 4.Materials and methods: plain text is too much. Authors should try to visualize the content at least by using listed form. 5.Results: The content of S1 table should be inserted into the text. This table defines the terms which are used in the results chapter. Without that information the content is not clear. Response: Thank you for your comments. We rewrote Section 3 and inserted S1 table into the text. We stated that “definitions of the variables are provided in the Table 1.” In that case, the content of main Materials and methods is much more clear. In addition, we deleted duplicate similar statements to show different measures as we mentioned briefly. Please see revised Section 3, on page 11-12. 6.The legend for the abbreviations shall be given below the tables. The format of the tables is not clear enough. The conclusions derived from the analyses should be highlighted at the end of the subchapters, at least in a new paragraph. 7.The asterisks *, , * are very confusing in the tables. Other indication should be used. Response: We are very thankful for this comment. We are sorry that the format of the tables is not clear enough. The legend for the abbreviations have be given below the tables. The description of each table has been modified in revised paper. Another indication have been used to shoe the asterisks *, , * clearly. In the revised paper, we stated that “The standard errors are given in parentheses. Significance levels: *p < 0.01, p < 0.05, and * p < 0.1.” Moreover, we are sorry that we do not highlight our finding. In the revised manuscript, we reorganized added more discussions of the unique results at the end of the subchapters (several new paragraphs) . Please see revised Section 4 and 5, on page 21 and 28. 8.In the present form it is hard to find what was the aim for conducting the performed analyses. Again, I recommend to add a visualized conceptual model which may help to follow the process of the research, how the analyses lead us to the new results. Response: we added a figure to clearly clarify the economic logic framework of our research in the revised manuscript, Please see revised Section 1, on page 2-5,9. The economic channels or research logic frame is as follows: Fig. 1. Logical diagram of customer concentration effect on firm risk-taking. 9.Conclusions: must be broadened. It says: "We empirically document that an inverse U-shaped curve exists between customer concentration and corporate risk-taking." Yes, but it is not highlighted in the results. Please show it. Response: Thank you for comments. We made our best efforts to improve the writing. We rewrote the discussion of the main findings in all sections in the revised manuscript and added several new paragraphs. For example, we gave detailed discussion of in Section 4on page 24 and Section 5 on page 31 to highlight results. We also added more contents of conclusion in Section 6 and added further analyses in Section 6 For example, we argue that “The role of customer concentration could be treated as "double-edged sword" for the hosting firms” Please see revised Section 6, on page 28 to 30. It is seen that authors presented a complex research, but the way of presentation must be improved for acceptance. Once again, thanks so much for your insightful comments and suggestions. They have helped us improve this paper significantly. Response to Reviewer 2 Title:Does the risk of major customer need to be balanced? The role of customer concentration in corporate governance (PONE-D-21-18289) We appreciate the comments and suggestions in your referee’s report, which have helped us to better position the paper. We have carefully revised the paper to incorporate your suggestions. We believe that the incorporation of your suggestions has made significant improvement to this paper. The revised part of the paper is in blue. Below please find our point-by-point responses, with the referees’ original comments shown in italics. And the revised manuscript are attached. Reviewer #2: The paper investigates the role of customer concentration on corporate governance and how the risks of main customers can influence the company. The study is well written, its structure is perfect (except the keywords which are missing). The abstract is well written, giving a brief highlight of the content in an excellent style. The introduction explains the importance of the topic and introduces the importance and context, supported by some literature sources. The literature review is well based, critical, and analytical enough; the hypotheses are developed in this framework too. The methodology is clearly written, logical. Moreover, the authors selected the appropriate methodological toolset and applied them very well. The methodology well supports the results; the conclusions are based on the results. The language of the paper is scientific enough and well understandable. .Response: Thank you for comments. In the submission system, the key words we write are as follows: Keywords: corporate governance; customer concentration; risk-taking; monitoring and certification；firm performance We also made our best efforts to improve the quality of the paper. First,we reorganized Introduction with 4 pages by abbreviating research contribution and deleted duplicate similar statements. Second, we added a new paragraph to explain the chapter arrangement and structure and a figure to clearly clarify the economic logic framework of our research in the revised manuscript. Third, we highlighted our finding.In the revised manuscript, we added more discussions of the unique results at the end of the subchapters (several new paragraphs).We also added more contents of conclusion in Section 6. Fourth, we use a figure to show the economic channels or research logic frame in Section 3. Fig. 1. Logical diagram of customer concentration effect on firm risk-taking. Once again, thanks so much for your insightful comments and suggestions. They have helped us improve this paper significantly. Attachments Attachment Submitted filename: Response to Reviewers.doc https://doi.org/10.1371/journal.pone.0259689.r002
25 Oct 2021 Decision Letter - László Vasa, Editor Does the risk of major customer need to be balanced? The role of customer concentration in corporate governance PONE-D-21-18289R1 Dear Dr. Ma, We’re pleased to inform you that your manuscript has been judged scientifically suitable for publication and will be formally accepted for publication once it meets all outstanding technical requirements. Within one week, you’ll receive an e-mail detailing the required amendments. When these have been addressed, you’ll receive a formal acceptance letter and your manuscript will be scheduled for publication. An invoice for payment will follow shortly after the formal acceptance. To ensure an efficient process, please log into Editorial Manager at http://www.editorialmanager.com/pone/, click the 'Update My Information' link at the top of the page, and double check that your user information is up-to-date. If you have any billing related questions, please contact our Author Billing department directly at authorbilling@plos.org. If your institution or institutions have a press office, please notify them about your upcoming paper to help maximize its impact. If they’ll be preparing press materials, please inform our press team as soon as possible -- no later than 48 hours after receiving the formal acceptance. Your manuscript will remain under strict press embargo until 2 pm Eastern Time on the date of publication. For more information, please contact onepress@plos.org. Kind regards, László Vasa, PhD Academic Editor PLOS ONE Additional Editor Comments (optional): Reviewers' comments: Reviewer's Responses to Questions Comments to the Author 1. If the authors have adequately addressed your comments raised in a previous round of review and you feel that this manuscript is now acceptable for publication, you may indicate that here to bypass the “Comments to the Author” section, enter your conflict of interest statement in the “Confidential to Editor” section, and submit your "Accept" recommendation. Reviewer #1: All comments have been addressed Reviewer #2: All comments have been addressed ******** 2. Is the manuscript technically sound, and do the data support the conclusions? The manuscript must describe a technically sound piece of scientific research with data that supports the conclusions. Experiments must have been conducted rigorously, with appropriate controls, replication, and sample sizes. The conclusions must be drawn appropriately based on the data presented. Reviewer #1: (No Response) Reviewer #2: Yes ****** 3. Has the statistical analysis been performed appropriately and rigorously? Reviewer #1: (No Response) Reviewer #2: Yes ****** 4. Have the authors made all data underlying the findings in their manuscript fully available? The PLOS Data policy requires authors to make all data underlying the findings described in their manuscript fully available without restriction, with rare exception (please refer to the Data Availability Statement in the manuscript PDF file). The data should be provided as part of the manuscript or its supporting information, or deposited to a public repository. For example, in addition to summary statistics, the data points behind means, medians and variance measures should be available. If there are restrictions on publicly sharing data—e.g. participant privacy or use of data from a third party—those must be specified. Reviewer #1: (No Response) Reviewer #2: Yes ****** 5. Is the manuscript presented in an intelligible fashion and written in standard English? PLOS ONE does not copyedit accepted manuscripts, so the language in submitted articles must be clear, correct, and unambiguous. Any typographical or grammatical errors should be corrected at revision, so please note any specific errors here. Reviewer #1: (No Response) Reviewer #2: Yes ****** 6. Review Comments to the Author Please use the space provided to explain your answers to the questions above. You may also include additional comments for the author, including concerns about dual publication, research ethics, or publication ethics. (Please upload your review as an attachment if it exceeds 20,000 characters) Reviewer #1: (No Response) Reviewer #2: The author made significant changes based on my previous recommendations and improved the paper well. Based on its current status and quality, I find it eligible for publishing in Plos One without changes. ****** 7. PLOS authors have the option to publish the peer review history of their article (what does this mean?). If published, this will include your full peer review and any attached files. If you choose “no”, your identity will remain anonymous but your review may still be made public. Do you want your identity to be public for this peer review?** For information about this choice, including consent withdrawal, please see our Privacy Policy. Reviewer #1: No Reviewer #2: No https://doi.org/10.1371/journal.pone.0259689.r003
Formally Accepted
29 Oct 2021 Acceptance Letter - László Vasa, Editor PONE-D-21-18289R1 Does the risk of major customer need to be balanced? The role of customer concentration in corporate governance Dear Dr. Ma: I'm pleased to inform you that your manuscript has been deemed suitable for publication in PLOS ONE. Congratulations! Your manuscript is now with our production department. If your institution or institutions have a press office, please let them know about your upcoming paper now to help maximize its impact. If they'll be preparing press materials, please inform our press team within the next 48 hours. Your manuscript will remain under strict press embargo until 2 pm Eastern Time on the date of publication. For more information please contact onepress@plos.org. If we can help with anything else, please email us at plosone@plos.org. Thank you for submitting your work to PLOS ONE and supporting open access. Kind regards, PLOS ONE Editorial Office Staff on behalf of Prof. Dr. László Vasa Academic Editor PLOS ONE https://doi.org/10.1371/journal.pone.0259689.r004

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