An Analysis On Large Stockholder Controlling And Corporate Governance In The Full Circulation Of Stock Market

More and more empirical studies proved, concentration of shares and appearance of large shareholders become international trend of corporate governance. Under the frame of"large shareholders—corporate governance", the rule and position of large shareholders in corporate governance will be discussed. Furthermore, the characteristic behaviors of large shareholders in the full circulation of stock market will be deeply analyzed and compared.Firstly the background of this study is summarized in the beginning of the paper. Then the theory of corporate governance is completely demonstrated. Based on these, we can get the conclusion that large shareholder is agency, but small shareholder is principle from the theory of principle-agent.This paper has especially analyzed the problem of expropriation by large shareholders of public corporations on small investors and how to settle the problem in China. We find the reason why large shareholders expropriate on small shareholders with qualitative analysis, from the securities market orientation of out country, ownership structure, corporate governance, portfolio supervision and investor legal protection, then set up mathematic model with quantitative analysis. On the basis of the model, we put forward three measures to restrain the expropriation by large shareholders. First, improving corporate governance which is focus on perfecting the function of the board of directors, building manager'market and company control power market. Second, strengthen the supervision of the supervision department of security market. Last, strengthen the legal protection to minority stock holder from legislation, the administration of justice and enforcing the law.