Research On Impact Of Listed Companies' Ownership Structure On Financial Risk

In our country securities market, irrational warranties, excessive investment, controlling shareholder's embezzlement, improper related party transaction of listed companies are very serious. These facts aggrandize instability of financial status of listed companies. They are main causes of formation of financial risk. By analyzing, we can find that ownership structure is one cause of formation of these facts. It becomes important source of forming of listed companies' financial risk indirectly. Ownership structures of listed companies have important influence on forming of financial risk.On the view of theoretical analysis, ownership structure is the property rights basis of corporate governance system. First it decides control right structure of company. Then it decides constitution and operating of company's inner corporate governance organization and influences corporate governance efficiency through inner corporate governance organization. Under our country's especial institutional background, ownership structures of listed companies are different from the others. Behaviors of different shareholders become dissimilar and conflicting. Then these may cause and enlarge financial risk.The empirical research showed that there is little evidence in support of neither the correlation between the proportion of liquid shares and financial risk nor the correlation between the proportion of non-liquid shares and financial risk. The segmentation of share liquidity causes that market of corporate control can't work effectively. There is a negative and significant correlation between the proportion of state-owned shares and financial risk. This showed that state-owned shares have some positive effect on keeping the stability of corporate governance. There is insignificant correlation between the proportion of legal-person shares and financial risk. Stockholders of legal-person shares didn't exert positive action effectively. The correlation between the proportion of managers' shares and financial risk is not significant because of the low proportion. Stockholders of public shares have limited effect on corporate governance. The correlation between the proportion of public shares and financial risk is not significant. Financial risk increases with the proportion of foreign shares. There is a negative and significant correlation between and financial risk. This demonstrated that the high rate of ownership concentration is a kind of relatively effective ownership structure. The correlation between rate of equity restriction and financial risk is positive and significant. Equity restriction can't improve corporate governance obviously. We can optimize listed companies' ownership structure to control financial risk by these measures base on theoretical analysis and empirical research. The measures include: perfecting rights of different kinds of stockholders, reducing state-owned shares moderately, strengthening and regulating the developing of institutional investors, fostering institutional environment to make stockholders use rights normally.