A Research On The Financial Distress Considering Corporate Governance Factors

Theories of corporate governance point out that corporate governance plays an important role in corporate management. Erecting a model including rations of corporate governance is important to improve credit risk management.The model based on the financial ratios may be affected by other factors. The corporate governance may play an important part in financial distress of public companies. So we expect that we can improve the model through considering corporate governance factors. On the other hand, we also expect to find out the reference to enhance the corporate governance in China.According to previous studies on financial distress of corporate pointed out that financial ratios and corporate governance factors made the construction of financial distress model could obtain excellent financial distress predicting model. We will make a model including financial ratios and corporate governance factors based on data from the public companies from Shanghai and Shenzhen stock exchange. In the end, we will make some conclusions and propose some advice.