Institutional Investors And Corporate Governance Efficiency

Modern company, because the two rights separation produces the principal-agent problem that corporate governance become actively explore topics, after the 1980s with the development and expansion of institutional investors, make it difficult for institutional investor get long-term revenue from selling the stocks, institutional investors began to take part in the corporate governance structure, in order to improve the condition of governance listed companies for revenue.China's capital market in the system construction, basic of the market and investment concept , it has very big disparity with mature market countries. The institutional investor's experiences in corporate govern are not very rich, so it has extremely limited function in improving corporate governace performance. In this background, Analysis institutional investors participate in the management of corporate to influence corporate performance, Research the mechanism of institution investors influence corporate governance, Summarize the performance of institutional investors'take part in corporate governance and the problems through the analysis of the present situation. It is good for understanding Chinese institutional investors and corporate governance, so for institutional investors take part in corporate governance more effective provide effective reference.Based on the theory of corporate governance, using qualitative analysis and quantitative analysis, normative analysis and empirical analysis method, through the review of "managers'capitalism"to "investors capitalism" corporate governance trend explains institutional investors development, combining with the analysis of convergence of interest and expropriation to research mechanism of institution investors influence corporate governance. Based on briefly review the development and practice of institutional investors in China, details explained the role of institutional investors in corporate governance and existing problems. Then taking this as basis, quantitatively analyzed the effect which institutonal investors have on the listed companies. Proofed hypothesis that institutional investors participate in listed companies improving corporate governance performance. But in our market, barriers factors that blocking institutional investors to participate in corporate governance still existing. Such as institutional investors in small scale, uneven development of investors, management function of institutional investors don't fully etc. So, we should perfect the market mechanism in our country, create loose policy environment, insist on develop institutional investors, establish multiplication institutional investors, strengthen supervision and improve the internal control ability of institutional investors, So as to bring the institutional investor's positive role on corporate governance performance into full play.