Study On The Relationship Between The Change Of Corporate Governance Structure And The Prediction Of Financial Crisis

Financial crisis has become an important issue in economy field. The broke out of financial crisis not only threaten the survival of the corporation, brings the investors, the creditors the employees the heavy loss, but also can shift the cost of financial failure to the public and cause the society to be impacted widely. Therefore, studying the deep-seated reasons of financial crisis and helping the corporations avoid the financial distress has become urgent need for the various benefit counterparts.In recent years, the complexity and uncertainty of the economic environment is becoming more and more evident. And the causes that the companies to have the financial crisis are many, but the incomplete corporate governance is the basic reason. Accordingly, the weak corporate governance leads to management's power out of check and balance, and the resulting agency problems make the possibility of financial crisis increase.To this end, this paper regards the special treatment as the sign of the listed companies encountering financial crisis and studies the effect of corporate governance structure on financial crisis in ownership structure perspective and board governance structure perspective. By the method of empirical analysis, this research also studies the relationship between the change of corporate governance structure and the change in financial position.After the analysis of empirical data, the paper obtains the main conclusion is as follow: 1.When other shareholders can not check and balance the controlling shareholder, the possibility of financial crisis will be increased. 2. The frequent replacement of independent directors is the sign of the company tending to financial crisis.Compared with the previous study , this research study the relationship between the change of corporate governance structure and financial crisis in longitudinal perspective and analyze the role of the deterioration of corporate governance in the process of financial crisis. It is expected that the conclusion of the research has significance for Chinese listed companies, government regulators and investors.