Study On Expropriation By State-owned Controlling Shareholders Of Listed Companies Under The Parent Corporation

Based on the special development history of China's stock market, state-controlling under the parent corporation is the main feature of listed corporations. The high proportion of state-owned shares had brought about many problems, especially the expropriation by state-owned controlling shareholders. In resent years the expropriation by state-owned controlling shareholders receives more and more studies, while short of comprehensive and systematic analysis. First, this paper reviewed some forms of expropriation by state-owned controlling shareholders. Second, through improving the method adopted by Dyck and Zingal (2001), the average degree of expropriation by state-owned controlling shareholders was calculated to 10.64%, which significantly correlated with the scale of listed company and the level of debt. Third, the study explained the course of the expropriation, that is, the state controlling shareholders had the potential demand of profit conveyance when it cannot achieve its multiple objectives, and it could become the reality under the circumstance of unsound corporate governance. Final, the paper put forward a constructive framework to settle the expropriation problem, which establish and perfect the corporate governance on the basis of strengthening the capacity of self-dependence of state-controlling shareholders.