Bond Financing And Corporate Governance In Listed Companies

In China, enterprises'external financing obvious lean to equity financing and bank loans financing. The corporate financial structure is irrational; it goes against to perfect governance structure. Bond financing has been restrained and seriously lagged behind economy development. Bond financing can restraint manager's behavior, improve corporate governance. The issue of company bonds is not only lower-cost but also inhibit the problem caused by interest of control right. And the information feedback from balance market price can help companies making right decision-making. The paper research corporate bonds financing and corporate governance in the hope of giving some revelation to the actuality that Chinese enterprises prefer equity financing to bond financing.On the foundation of related information and data, the paper use empirical and theoretic methodology, including economy and finance theories. Beginning from the bond financing's governance mechanism and how corporate governance factors effect bond financing, then analyze the relationship between bond financing and corporate governance of Chinese listed companies from both theoretical and empirical methodology, finally draw conclusions as follows:Bond financing and corporate governance influence each other. Firstly, bond financing have positive role to listed companies'value through analysis. While bond financing have a certain restraint to management consumption and the use of free cash flow.Secondly, the facts of corporate governance structure have a significant impact on the scale of bond financing. The financial leverage has a significant negative correlation with bond financing. Second, the high concentration of shareholding structure has a negative correlation with corporate bonds. Enterprise performance and corporate bonds are positive related. The company's capital structure doesn't affect the scale of bond financing.Thirdly, corporate governance variables affected the corporate decision-making of whether issue bonds for financing. The company's financial leverage and bond financing options have a significant negative correlation; the top ten shareholders'stock proportion has no significant impact to bond financing preferences. The industry factors also have no significant affection to corporate bond financing.Finally, give some policy suggestions such as set up rational corporate governance structure, effective debt paying mechanism and normative bylaw of bond market.