Research On Corporate Governance Efficiency Of China's Listed Companies' Debt Renegotiation

At present, one of the most critical problems influencing China's listed companies and security market development is the irrational corporate governance. Sampling listed companies, we studied the relationship between listed companies debt financing and corporate governance. We mainly studied debt renegotiation companies' corporate governance efficiency problem. The intention is solve two problems. One is the responding of debtee when debtor meets finance trouble or pretending to announce meeting finance trouble. The other is the influence mechanism for debt renegotiation on listed companies' corporate governance efficiency.Firstly how debtee and debtor deal with problem debts when debtor had a defeated investment and difficult to pay off owed debt completely or in time. Commonly there were two disposal methods. One is to force debtor go into bankruptcy and liquidation under law regulation. The other is to renegotiate the debts of objective company. Because of high bankruptcy and liquidation cost, debtor and debtee were inclined to select the last method.Secondly this article set up dummy variable to reflect the influence for debt renegotiation on listed companies' corporate governance by 38 China's listed companies' data declared debt renegotiation bulletin in 2003. Dummy variable was negative correlative with corporate performance. Debt renegotiation produced serious moral hazard and converse select problems. Companies' operator could obtain benefits from pretending to announce meeting finance trouble and debt renegotiation such as decreasing debt scales, and so on. So operator's effort degree would be reduced. Debt renegotiation couldn't improve well China's listed companies' corporate governance efficiency, even appeared negative efficiency.Finally according to China's listed companies' detail situation, we put forward relevant policy advices about how to improve debt renegotiation on China's listed companies' corporate governance efficiency. For example, perfecting China's listed companies out of security market standards, corporate governance and repay debt...