Study On Corporate Governance Structure And Performance Of Mixed-Ownership Enterprises

In 2013,the Communist Party of China adopted the "Decision on Several Major Issues Concerning the Overall Deepening of Reform" in the third Plenary Session of the 18th CPC Central Committee.It clearly proposed that we should "actively develop mixed-ownership economy",and also set mixed-ownership economy as an important realization form of China’s basic economic system.This indicates that under the new normal of China’s economy,mixed-ownership enterprises will have a new opportunity for development.Mixed-ownership reform was not an entirely new concept,as it appeared in government documents as early as 1997.The rise of such enterprises is closely related to the reform of state-owned enterprises,which is an inevitable outcome during the transition process from planned economy to market economy.Although the reform process of state-owned enterprises had slowed down,there was a phenomenon of" going back to the stated-owned",which even made the development of the mixed-ownership enterprises had stagnated.However,with the rapid development of China’s economy and the deepening of the reform in the new period,the development of mixed-ownership has become the focus of this period,which is of great significance to break through the bottleneck of state-owned enterprises reform.At present,some progress has been made in the new round of mixed-ownership reform.By the end of 2017,more than 60%of the state-owned enterprises had been transformed into mixed-ownership enterprises,and the pilot reforms had already been carried out to the third batch of enterprises.Although the number of mixed-ownership enterprises has already reached a certain scale,there are still many problems to be perfected in the process of practice,which results in an unsatisfactory level of reform.Compared to the past,the reform of the mixed-ownership system has gradually involved some micro-level problems.The integration of different types of capital at the enterprise level only forms the basis of property right.If we want to make the mixed-ownership enterprises play a substantial role,we need to establish a scientific and effective structure of corporate governance.Therefore,it is necessary to carry out an in-depth study on the governance structure of the mixed-ownership enterprises,exploring the effective and feasible solutions to make it more perfect.This will benefit the enterprise to optimize the allocation of resources,improve the overall performance level of the enterprise.Not only enhancing the competitiveness of state-owned economy,but also benefits the development and growth of non-state-owned economy.In this sense,the research of this paper is of great practical significance to the development of mixed-ownership enterprises.This paper is mainly based on the theory and research results of corporate governance,and also combined with the current development of mixed-ownership enterprises in China,to analyze the relationship between governance structure and performance of such enterprises.Through exploring the internal relationship between various factors and performance of governance structure,we can provide feasible reform proposals for existing governance structure to further improve the governance framework of mixed-ownership enterprises.Although the existing literature of corporate governance has made abundant achievements and formed a corresponding research system.But the problem of corporate governance of mixed-ownership enterprises is more special than that of general enterprises.Whether the existing research conclusions are applicable to such enterprises needs further verification.Therefore,the problem of corporate governance in mixed-ownership enterprises still exists space for research,which is also the theoretical significance of this paper.In addition to the introduction,this article is divided into six chapters.First of all,this paper reviewed and summarized the literatures related to mixed-ownership,corporate governance structure and performance.On this basis,the concepts of mixed-ownership enterprises and corporate governance structure,which will be involved in this paper,was defined.From the perspective of economics and management,this paper reviewed the related theories of property rights,principal-agent theory and stakeholder theory,this built the foundation for theoretical analysis in following parts of this paper.Then,this paper was based on the reform process of China’s state-owned enterprises,reviewed the policy development and the rise of the mixed-ownership enterprises.In fact,the emergence of mixed-ownership enterprises is inevitable.In the process of gradual transformation of China’s economic system,this new form of enterprise provides an opportunity for the effective combination of state-owned enterprises and the market.However,in the new period of reform,the development of mixed-ownership enterprises is still facing many obstacles,most of which are related to the problem of corporate governance.Therefore,based on the principal-agent theory and the characteristics of mixed-ownership enterprises,this paper made a systematic analysis of the governance structure of mixed-ownership enterprises from three aspects,namely equity management,board governance and management incentives.By analyzing and summarizing the important factors of these three aspects,we found out the main factors that affect the efficiency of the governance structure of mixed-ownership enterprises,and also built a basic analytical framework for the governance structure of mixed-ownership.Then,based on the theoretical analysis framework constructed,this paper studies the relationship between the factors and performance in the governance structure of mixed-ownership enterprises.This paper analyzed the mechanism between governance structure and performance from a theoretical point of view,so as to explore the key to improve the governance structure of this kind of enterprise.At the same time,in order to further verify the conclusions of theoretical analysis,the data from mixed-ownership enterprises in Shanghai and Shenzhen listed companies in 2007-2016 years were selected as samples for empirical research.From the three aspects of equity governance,board governance and management incentives,relevant explanatory variables are selected.Combined with previous theoretical analysis,the empirical research hypothesis was put forward,and an empirical model was constructed to test it.Based on the theoretical and empirical analysis of this paper,the following conclusions are obtained.In the mixed-ownership enterprises,the proportion of state-owned shares has a significant positive effect on corporate performance,but the proportion of state-owned shares will have a negative impact on corporate performance.The ownership structure of mixed-ownership enterprises is generally concentrated.The shareholding ratio of the first largest shareholder and the top five shareholders has a significant positive effect on corporate performance,and the effect is more obvious in state-owned holding mixed-ownership enterprises.But when the ownership is too concentrated,it will have a negative impact on the performance of the enterprise.In the same way,the degree of equity balance can promote the enterprise performance in a certain range.But the high degree of balance will lead to the dispute of control in the enterprise,which leads to the improvement of the enterprise’s decision-making risk and has a negative impact on the enterprise performance.In terms of board governance of mixed-ownership enterprises,this paper finds that there is no obvious correlation between the size of the board,the proportion of independent directors,and CEO duality to the performance of enterprises.But considering the impact of board governance on corporate performance may be lagging behind,it has a certain impact on corporate performance from a long-term perspective.Moreover,the development history of China’s board governance system is not very long.There are still many aspects to be perfected.This also limits the effectiveness of board governance to some extent.The board of directors has an important position in decision-making and supervision,and the mixed-ownership enterprises still need to pay attention to the institutional arrangements related to the governance of the board of directors.In the aspect of management incentives of mixed-ownership enterprises,we found that in mixed-ownership enterprises,the impact of salary incentive on business performance is more obvious than equity incentive,and also has a positive role in promoting.The incentive effect of equity incentive is not fully reflected in the mixed-ownership enterprises because of the complexity of the examination and approval procedure.In addition,there are implicit incentives for political promotion for managers who have administrative positions in the mixed-ownership enterprises.However,due to the difficulty of observation,this paper did not carry out an empirical analysis of its performance and enterprise performance.However,in view of the different political backgrounds of the managers,there are certain differences in the incentive system.When making incentive mechanism,a mixed-ownership enterprise still needs to enlarge its incentive utility by combining different incentive ways according to the characteristics and interests of managers,so as to enhance enterprise performance.Finally,according to the conclusions of this study and the actual conditions of China,the policy recommendations for the improvement of the governance structure of the mixed-ownership enterprises were put forward.First of all,we must improve the level of equity management,then strengthen the governance structure of the board of directors,third,design a reasonable and effective incentive mechanism,and fourth,we should gradually improve China’s external governance mechanism.The research in this paper can enrich the related research of corporate governance and mixed-ownership to a certain extent.By constructing the analysis framework of mixed-ownership business governance structure and improving enterprise performance as a breakthrough point,this paper explored feasible solutions for such enterprises to improve their governance structure.And through the empirical analysis,the conclusion of the theoretical analysis is further verified.This had provided the theoretical and practical value for the construction of an effective governance structure for the mixed-ownership enterprises in China.