The Research On The Relationship Between Corporate Governance And Growth Of The Listed SMEs

The core of corporate governance is for ensuring the scientific decision and the efficient operation. The level of corporate governance is essential for competetivity and we should focus on the improvement and perfection mechanism to attract investors, improve performance and sustainable development. The growth is directly related to governance level and good governance is bound to promote healthy development. We can say that the sustainability and effectiveness is essential for improving the growth. As Chinese capital market develops further, the listed SMEs are becoming the main force and good representatives of all SMEs. Studies on the listed SMEs should be prospective and representative. So the paper chooses a popular topic and both theoretically and practically meaningful.The study targets are the listed SMEs and we use ways of the dialectics analysis, the empirical analysis, the econometrics analysis to study the effect of governance on the growth through international comparison on the basis of the SMEs theory, the growth theory, and the company governance theory. The model about the relation between the SMEs governance and the growth based on the principal-agency theory offers necessary theory basis. Then we establish an indicator system having one first-level indicator, four second-level indicators, fourteen third-level indicators based on the analysis of principal component and empirically study the growth. Then we empirically study the relationship between the growth and corporate governance from four dimensions of the equities govemance, creditor's right governance, the board governance and the management incentive, and reach conclusions as following.1. The relation between the growth and the share concentration doesn't present an inverse U shape. The equities ratio held by state-owned companies is positive related to the growth. The largest shareholder affects the operation greatly for state-owned companies. The sum of top five equities ratios except the largest one is negative related to the growth. The largest equities are significantly negative related to the growth.2. We find that large state-owned companies are in the top thecreditor's right governance bulletin board using the creditor's right governance in our study. There is a significant inverse U shape representing the relation between the indicator F and the growth. The improvement of repaying comes with worse growth. The level of obligation is significantly positive related to the growth. The time limit of obligation is a little positive related to the growth. The time limit of obligation is unbalanced. The obligation type is simple and the borrowings from banks are the most. The time limit of assets is a little negative related to the growth. The time limit of assets is unbalanced.3. The study on the board governance finds that the board scale, the ratio of independent directors and managing directors and the level of directors' knowledge are significantly positive related to the growth. There is an inverse U-shape between the balance-stable indicator and the growth, and the growth is on the peak when the indicator is 0.6. The occupation of managing directors from parent companies can bring negative growth. The integration of power from directors and managers has no effect on the growth.4. The study on management incentive finds that the annual pay is the most important incentive mechanism and is greatly sensitive to the growth. There is a U-shape relation between the growth and the low ratio of managers' equities. The number of managers who receive payment in parent companies is positive related to the growth. The company scale, finance level and industry affect the growth significantly.At last we provide with political advice about macro-government, investment, finance, taxes, human resource, incentive mechanisms, macro-environment and so on. Theoretically it will make up for the lack of researches on the theme, perfect and develop the SMEs theory, growth theory and governance theory. Practically it will help make effective policies in order to promote the growth of the SMEs better.