Study On The Non-tradable Share Reform,Equity Structure And Cash Dividends Policy

In the context of non-tradable share reform, this article uses the Chinese listed companies as the sample, using the data mining and the statistical technology, compares the cash dividends policy during the year of 2003-2007 from the aspects of distribution desire and distribution level to examine how the non-tradable share reform affects the cash dividends distribution behavior of Chinese listed companies.The empirical study of the relationship between non-tradable share reform, equity structure and cash dividends policy shows: under the equity split state, the controlling non-tradable shareholders have strong preference for cash dividends, cash dividends policy tend to become another benefit transportation "tunnel" following internal transactions for majority shareholders. After the reform, whether in the cash dividends distribution desire or distribution level, this strong preference has dropped significantly, thereby confirming after the reform, the "tunnel" motivation through cash dividends policy of majority shareholders is reduced.The empirical study of the relationship between the degree of equity balance and cash dividends policy supports the hypothesis of multiple large shareholders tend to restriction each other, but does not supports the collusion hypothesis. Under the equity split state, the balance equity structure with several large shareholders is helpful to curb the "tunnel" behavior through cash dividends policy of majority shareholders, after the reform, although the degree of equity balance improved, but still at a low level, the balance equity structure has not yet fully formed, its suppression effect of cash dividends expropriation has increased, but not significant.The empirical study of different equity property sub-samples indicates that: the reduced level of cash dividends "tunnel" effect for state-owned companies is stronger than private companies, of which the weakening extent of the positive relationship between local government stakes and cash dividends payout ratio is stronger than that of the central government. The positive relationship between the proportion of private equity and cash dividends payout ratio is weakened after the reform, but not significant.The empirical study of the relationship between controlling shareholder and cash dividends policy shows: the cash dividend per share drops in companies with a controlling shareholder after the non-tradable share reform. In addition, the positive correlation between the cash dividend per share and the share-holding proportion of controlling shareholder has weakened significantly, thereby confirming again "the tunnel effect" of cash dividends is weaken after the reform. When considering the relationship between cash dividends policy and company's growth, further research found before the non-tradable share reform, the relationship was not significant, after the reform, the cross-variable of company's growth and equity structure has a significantly negative correlation with cash dividends per share. This indicates after the reform, the malignant cash dividends distribution behavior regardless of long-term development of majority shareholders is effectively curbed.Summarizing, after the non-tradable share reform, because of the optimization of equity structure, results in: the unification of the interests basis of majority and minority shareholders; the mitigation of dual agency conflict; the improvement of corporate governance structure; a more effective capital market; and the abnormal phenomenon in cash dividends distribution behavior of Chinese listed companies gradually returns to normal, furthermore, the phenomenon of distributing cash dividends beyond companies' capability and distributing cash dividends for further financing are significantly reduced; the continuity of cash dividends policy is enhanced; and the cash dividends distribution desire is rising. The conclusion is: after the reform, the "tunnel" behavior through cash dividends policy of majority shareholders is effectively curbed.