Research On Capital Structure Of Forestry Listed Companies --- From Stakeholder’s Perspective

Since Eighteenth National Congress of the Communist Party of China stressed that "the construction of ecological civilization should be in a prominent position, and strive to build a beautiful China" concept of development, the role of forestry in China’s ecological and economic construction is becoming increasingly important, forestry development opportunities and challenges exist simultaneously. Forestry listed companies have pull and traction function for industrial development and sustainable development of Chinese forestry industry. Chinese forestry business groups represent advanced productive forces. With the state-owned forest tenure reform and the "Natural Forest Protection Project" and other policies progresses, how to achieve better and faster development is a problem for forestry listed companies.Forestry has a long investment cycle, a large amount of funds is required for the industry, very high capital investment is required. However, in China’s security market, the quantity, total asset and equity share of forestry listed companies are still of small scale. In the development process of forestry listed companies, an important issue is the capital structure of forestry listed companies. Forestry listed companies asset-liability ratio is generally higher than the average domestic level of listed companies over the same period, however, the profitability of forestry listed companies is lower than the average domestic over the same period. From the financial data, a higher debt ratio of forestry listed companies is not compatible with the corresponding higher profitability. Is listed forestry company’s current capital structure a reasonable arrangement, what is capital structure influencing factors of forestry listed companies? Problems such as these are to be theoretical analyzed and empirical tested. In this paper stakeholder theory and capital structure theory are combined, in order to help to broaden the perspective of capital structure of forestry listed companies, to help business owners and managers of forestry listed companies to grasp forestry future trends, to improve capital allocation effectively, to reduce the cost of capital, to improve the ability to create business value, thus to promote the development of Chinese forestry industry.In this research, the forestry listed joint-stock companies in Shanghai and Shenzhen were taken as the research object, based on the theoretical and practical research of previous comprehensive results in both domestic and oversea relevant field in last decades, through literature review and analysis, this research obtained more comprehensive data, combined the normative analysis and empirical research methods to solve the capital structure problems of forestry listed companies in a number of important issues. First, learned and integrated domestic and overseas industry standards for forestry listed companies, then gave the definition forestry listed companies. Then analyzed forestry listed company’s size, regional distribution, the main business, forest resources and capital structure features were analyzed and found that in different life cycle capital structure of listed companies have a significant difference. Second, analyzed the impact from the shareholders, creditors, managers, employees, customers, suppliers’ perspective respectively on the capital structure of listed companies forestry, the analysis showed that, if the company takes higher capital structure, it will bear higher costs of bankruptcy and other additional costs, such as tighter lending conditions, the loss of customers and suppliers require a shorter recovery cycle funds. Therefore, it’s more rational behavior for the company to choose a lower debt ratio. Third, based on the existing domestic and foreign evaluation research, summarized affecting factors of the capital structure, selected related capital structure effecting indicators, used a multi-level multi-objective fuzzy optimization model, evaluated the status of the capital structure of forestry listed companies, then analyzed the results of the evaluation. Fourth,from stakeholder theory, the paper analyzed the financial and non-financial stakeholders’ impact on capital structure of forestry listed companies, then established a panel data model, took theoretical analysis and hypothesis test to prove previous assumption, then found financial stakeholders had more significant impact on the forestry listed companies than the non-financial stakeholders, non-financial stakeholders in forestry listed companies don’t take non-financial stakeholders into major considerations. Fifth, according to empirical findings from previous proposed measures, come up with suggestion to optimize the capital structure of the shareholders, creditors managers, employees, suppliers, and customers point of view, such as improving the relationship between banks, building wide governance mechanism and improving equity camera unitary structure then gave policy recommendations from a policy system and the external environment construction.