Empirical Analysis On The Relationship Between Alternation Of Destination Of The Financing Capital In Listed Companies And Corporation Governance

The allocation of resource is one of the important functions that capital market performs, which enables enterprises to acquire the fund they need for the development. A great many of listed companies gained the sustainable developing opportunities by refinancing. in recent years, however, many listed companies redirect the investment target after the funds are financed. A number of listed companies blindly finance a large amount of money, which frequently caused the alteration of financing capital by only finding projects as their sole target.The alteration of financing capital performed by listed companies directly affects the efficiency of security market. The effective allocation of resources is to provide funds to the listed companies that surely require funds to create values in such projects. But the blind financing conducted by such companies caused idle funds, consequently restricts and deforms the function of security market. Meanwhile, this large scale, huge amount behavior of changing investment direction severely impairs the interest of middle and small investors, depresses the initiatives of investment and affects the stability and long-term health development for domestic security market. These problems raise the great attention of security regulatory departments, economists and relevant parties.Under this circumstance, this paper combines the theoretical analysis and empirical test to verify the relationship between the alteration of financing capital and corporate governance on the basis of relevant theory by employing data to figure out the current situation and features of the alteration of financing capital statistically. Upon the basis of empirical test, this paper gives suggestions on the reasons that caused the alteration of financing capital.This paper discusses the following issues:First, this paper widely arranged the domestic and abroad literature on the alteration of financing capital and corporate governance, the theoretical foundation is built to study.Second, this paper describes the statistics of the current situation and the features of the alteration of financing capital then test the relationship between them. Further, this paper deeply analyzes the factors that affect the alteration of financing capital.Last, the content is summarized to provide listed companies with some policy suggestions.The result of the empirical test is:the listed companies'asset and the alteration of financing capital are negatively correlated; listed companies' liability/asset ratio isn't correlated with the alteration of financing capital. HHI is positively correlated with the alteration of financing capital; the control shareholder's share isn't correlated with that of the second to fifth shareholders. The scale of board is negatively correlated with the alteration of financing capital, the number of independent directors is negatively correlated with the alteration of financing capital, the scale of the supervisory board is negatively correlated with the alteration of financing capital but not significant. From the perspective of explainable variable- board chairman, the possibility of the alteration of financing capital is less when the degree of the board chairman is bachelor or master than that of vocational degree. The possibility of the alteration of financing capital is less when the degree of the board chairman is doctor than that of vocational degree but not significant.In summary, the asset scale, HHI, scale of board, ratio of independent directors and the degree of board chairman are the factors that affect the alteration of financing capital. In order to reduce it, the improvement of corporate governance is necessary, which can be harassed from the following aspects:first is to optimize the equity structure of listed companies to improve the degree of corporate governance, properly reduce the concentration level of shares to eliminate the influence over the process of financing. Then small shareholders' participation in corporate governance should be raised while big shareholders' behavior must be regulated. Next, board structure should be optimized and its scale can be enlarged, the number of independent director can also be raised in the board. Last, the function of supervisory board must be improved to perform its inspection mechanism.The result of this paper offers a reference for the further regulation to the management, the corporate governance and the avoidance of the alteration of financing capital.