The Study On The Influence Of Ownership Structure Of Chinese Listed Companies To Connected Transactions And Corporate Performance

As it is known for us, Chinese listed companies are not natural result of classical firms'institutions development but denying and rebuilding planning economic firm institution. Their goal is reforming state-own firms. During the change of institution ownership structure of Chinese listed companies is disequilibrium naturally and ownership is centralized highly. Many researches show the special ownership structure can not limit controlling shareholders control profits and invade the benefits of minority shareholders by connected transactions. Actually connected transactions have been the important ways of majority shareholders playing tunneling and expropriation to Chinese listed companies. It invades directly the benefits of minority shareholders. At the same time it is the main reason why a lot of firms'performance decrease badly or their profits are minus seriously.The subject of dissertation is the influence of ownership structure of Chinese listed companies to connected transactions and corporate performance. Based on totally analyze the collective situation of connected transactions of Chinese listed companies, the paper analyzes the relationship among connected transactions, ownership structure and capital structure, directorate's particularity, corporate performance from the different aspects. It maybe offer empirical evidences for improving the ownership structure, advancing the performance of firms, protecting the investors'benefits and developing China's stock market.The study on the influence of ownership structure to connected transactions discovers that the largest shareholder controls stock. The bigger stock is centralized, the bigger the amount, scale and probability of connected transactions. But the relationship between check-and-balance ownership structure among bigger shareholders or joint check-and-balance and connected transactions is minus correlativity. As connected transaction is an important way of the largest shareholder to invade other investors'benefits, the results mean that the reduction of state-owned shares or entire circulation is not only choice of improving the ownership structure and protecting investors'benefits. By limiting the highest ratio of the largest shareholder's share and the stock distributes more evenly among bigger shareholders and increase the number of them and intensify the power of check-and-balances among bigger shareholders. Transferring single-largest- shareholder ownership structure to multiple controlling shareholders maybe is an effective choice to prohibit connected transactions and improve the structure of corporate governance of listed companies.The paper analyzes amount and liability term structure of listed companies on the influence of capital structure to connected transactions respectively. The finding is that the relation between gross asset-liabilities ratio, current asset-liabilities ratio and connected transactions is positive correlation. But the increase of long-term debts decreases the scale of connected transactions of firms. Generally the debt financing of Chinese listed companies does not have the effect to promote and supervise firms.The paper partitions directorate's particularity into three aspects from structure, specialty and prompting by building econometrical models relating with connected transactions. The results are that the introduction of independent director system can improve the corporate governance of listed companies, decrease insider's invasions to investors'benefits and protect the rights of investors to some extent. In addition the setting of audit committee and the proper promoting to directors can reduce the connected transactions. The size of directorate has a positive correlation with connected transactions. Big size of directorate goes against efficiency of corporate governance. But the leadership structure does not have a significance of correlation with connected transactions. CEO duality is not an important factor influencing connected transactions. We should give firms more right autonomy and it is decided by market about the setting of CEO duality.After analyzing and evaluating all kind of ways of performance evaluation and index, the paper chooses CROA and MBR as indexes of evaluating firms'financial value and vendibility and tests the influence of connected transactions to corporate performance. The results of regression find that the listed companies which do not have connected transactions have better performance level than other listed companies which have connected transactions from the index of financial accounting and market value. Connected transaction does not urge the increase of firms'performance.The core of corporate governance is reform of ownership structure. Different shareholders structure and shareholding concentration and degree of bigger shareholders have a different result to the ways and effects of shareholder exerting powers. Further, it has a bigger influence to motion and performance of corporate governance. At the same time ownership structure is affected by the ways of supervision of capital market and the protection of law to minority shareholders. It is an endogenetic variable stated by supervision environment. If we want change ownership structure we can not ignore the change of the exterior reliant environment.