Empirical Study On The Effect Of Qualified Foreign Institutional Investors Shareholdings On Corporate Performances Of Chinese Listed Companies

China Company Law has been for more than 20 years since promulgated in 1993.However,many problems of corporate governance have been existed,such as "insider control","large shareholder manipulation" and independent directors without being independent etc.These problems restrict the development of Chinese listed companies.In order to perfect governance structure of Chinese listed companies and improve corporate operating performances,Chinese government put forward to actively develop mixed ownership economy and diversify the investment body.As oversea investment body and Chinese main institutional investors,qualified foreign institutional investors(QFII)own strong capital strength,rich management experiences,unique investment philosophy,and pursue long-term value investment philosophy.Then,what will be produced of QFII shareholdings effecting on corporate operating performances,which has been a hot debate in both academic and practice fields.Especially,with the increase of QFII shareholdings ratio and shareholdings quota,it is the focus of academic field to study the effect of QFII shareholdings on corporate operating performances from the perspective of corporate governance structure.Based on the existing research fruits,QFII shareholdings,corporate governance structure and corporate operating performances are put into a united analysis framework in this paper to study the effect of QFII shareholdings on corporate operating performances.Corporate governance theory and corporate performance theory are comprehensively used in this paper to study the following three issues.Firstly,the direct effect of QFII shareholdings on corporate operating performances.Secondly,the indirect effect of QFII shareholdings on corporate operating performances,namely,mediating effect test of governance structure of the board and governance structure of the supervisory board.Thirdly,the effect of interaction between QFII shareholdings and governance structure of the board and governance structure of the supervisory board on corporate operating performances.SPSS and AMOS statistical softwares are used in this paper,qualitative analysis and quantitative analysis are combined,and by employing research methods of theoretical deduction and regression analysis,theoretical study and empirical test are used to analyze the effect of QFII shareholdings on corporate operating performances.And corresponding policy suggestions are proposed lastly based on empirical study results.Four main innovations of this paper are as follows.(i)The relationship between QFII shareholdings ratio and investment philosophy has been clarified,becoming consolidate base for further research of the relationship between QFII shareholdings and corporate operating performances.QFII shareholdings ratio is divided into two interval segments,namely,QFII shareholdings ratio is less than 5%and between 5%-30%.Because of the difference of QFII shareholdings ratio,the investment philosophy of QFII will be different,and the effect of QFII shareholdings on corporate operating performances will be also different.The method of combing theoretical study with empirical study is used in this paper to analyze the effect of QFII shareholdings ratio of less than 5%and between 5%-30%on corporate operating performances.This study clarifies the relationship between QFII shareholdings ratio and investment philosophy,and make up for the lack of understanding about QFII investment philosophy of previous studies on QFII shareholdings ratio.This paper has been consolidate base for further empirical study on QFII shareholdings effecting on corporate operating performances,and is beneficial for enterprises' practical activities of improving corporate operating performance as a good guidance.(ii)Two mediating variables of governance structure of the board and governance structure of the supervisory board are introduced into this paper to analyze the indirect effect of QFII shareholdings ratio between 5%-30%on corporate operating performances.It reveals the transmission mechanism and functional route of QFII shareholdings effecting on corporate operating performances.On the basis of corporate governance theory and existing research fruits of corporate governance structure,the mediating effect of governance structure of the board and governance structure of the supervisory board are analyzed from the perspective of theoretical study and empirical study.This study reveals the functional mechanism and functional route of QFII shareholdings effecting on corporate operating performances,reveals the "Black Box" between QFII shareholdings and corporate operating performances,enriches and promotes the study of corporate governance structure,and has a certain references for China introducing QFII,perfecting corporate governance structure and improving corporate operating performances.(iii)The theoretical model of interaction between QFII shareholdings ratio of 5%-30%and governance structure of the board and governance structure of the supervisory board effecting on corporate operating performances are built,which further reveals the functional route of QFII shareholdings effecting on corporate operating performances.Based on the existing research fruits,the interaction between QFII shareholdings ratio of 5%-30%and governance structure of the board and governance structure of the supervisory board effecting on corporate operating performances is theoretical analyzed,and AMOS statistical software and interaction analysis are used to carry out empirical test.Thus,the functional route of QFII shareholdings effecting on corporate operating performances is.revealed.(iv)Existing researches do not distinguish corporate operating performances and corporate governance performances.However,this paper makes a distinction between them.The effect of QFII shareholdings on corporate operating performances is studied in this paper.Combining performance indexes of State-owned Assets Supervision and Administration Commission with the characteristic of Chinese listed companies,corporate operating performances are comprehensively measured from five aspects of profitability,asset quality,debt risk,business growth and equity expansion capability.Thus,measurement indexes of corporate operating performances of listed companies are perfected and enriched.This paper proposes that QFII of shareholdings ratio between 5%-30%pursues long-term investment philosophy.With the increase of QFII shareholdings ratio,QFII shareholdings will have a significant positive effect on corporate operating performances.Based on the conclusions,policy suggestions have been proposed as follows:(a)more quality QFII should be actively attracted into Chinese listed companies to improve governance structure of the board,governance structure of the supervisory board,and corporate operating performances;(b)Chinese government should relax the subject restriction of QFII entering into China,enlarge the restriction of QFII investment quota,lower the threshold of QFII access,and increase QFII shareholdings ratio;(c)Chinese government should strengthen the supervision of QFII,encourage long-term investment of QFII,restrict short-term investment behavior of QFII,and prevent manipulative behavior by QFII.