Research On Identification And Prevention Of Major Shareholder’s Capital Occupation

With the continuous development of corporate governance mechanisms,the conflict of interest between major shareholders and minor shareholders has become a problem that cannot be ignored in China’s capital market.For the motivation of satisfying private interests,major shareholders use various hidden methods and means to occupy the capital of the listed company.Solving this problem has always been one of the priorities of China’s regulatory authorities.Major shareholders illegally occupied the capital of the listed company not only damaged the company’s own interests,but also caused huge losses to minor shareholders.Therefore,it is an important and practical issue to identify the shareholders’ occupation of capital in a timely manner and formulate effective preventive measures to protect the interests of minor shareholders from infringement.This article uses Kangdexin Company as an example to study the issue of capital occupation of major shareholders through six chapters.Firstly,the causes,methods,consequences,identification and prevention of capital occupation by major shareholders are sorted out theoretically.Secondly,the theory of rights and benefits,information asymmetry theory and principal-agent theory are introduced.Then briefly introduced the relevant situation of Kangdexin Company,and then made in-depth research on the issue of capital occupation of major shareholders from the following aspects: First,through analysis of the causes of capital occupation of major shareholders from Kangdexin Company.The reasons for occupation mainly include: high concentration of equity structure,High demand for funds,ineffective internal control and insufficient external supervision.Second,by analyzing the method of capital occupation,we found that the methods of capital occupation of Kangdexin Company mainly including business capital occupation,non-business capital occupation and Related-party Guaranteerelated.Third,through analysis of the consequences of capital occupation,it was found that minor shareholders,creditors,and the capital market were all significantly negatively affected,it also found serious economic consequences for listed companies.Based on this,this paper establishes a set of methods that can help minor shareholders identify the major shareholder’s capital occupation from a financial perspective,and puts forward suggestions for preventing major shareholder’s capital occupation from the two aspects of corporate governance and external supervision,hoping to curb this kind of phenomenon occurs frequently,protects the interests of minor shareholders,and guarantees the healthy development of our capital market.