The Relationship Between Ownership Structure And Agency Cost In Our Country PLC

The relationship between ownership structure and agency problem is the heat points of corporate governance. The experts think that in company with low concentration of ownership, the agency problem is the interest contrast between shareholders and manager, but in company with high concentration of ownership, the agency problem is expropriation problem. The concentration of ownership structure in our country is very high, so in principle, the main agency problem should be big shareholder extract small ones. But, the control shareholders could be divided into state and non-state, and they have differences in nature.In paper, we divide the PLC into state owners and non-state owners, and research their ownership and agency problem. We find that although the concentrate of ownership in PLC is very high, the mainly agency problem in state-owner PLC is still the interest contrast among shareholders with managers, but in non-state owner PLC is the problem of control shareholder extract small ones. Through the empirical study, we find that:⑴In the state-owner PLC, with the increasing of the percent of control shareholder holding and the concentrate of ownership structure, the managers will work more efficient, but the problem of manager investment bias forward decision will be more worse. The larger of state-owner PLC, the interest contrast between shareholder and manager will be smaller, and the bank have no influent for the efficient of manager, but can control the bias forward of manager investment decision.⑵In the non-state owner PLC, there is not obvious relationship between ownership structure and agency problem, and the bank also can not survey the action of control shareholder. So, in order to low down the agency cost of PLC, for the state-owner PLC, we should make better of the ownership structure, build much better inner corporate governance system, and strengthen the survey for the agent of government who work in the PLC or the control shareholder of PLC. For the non-state-owner PLC, we should depend on the survey of law and policy.