An Empirical Study Of The Impact Of Institutional Investor On Corporate Governance

After the coming of 21 century, the fast development of institutional investor (II) has been supported by government policies and accordingly II has developed into a new stage. Along with the reform of Chinese stock market, the ratio of floating stocks in total stocks and the stocks owned by II has become higher and higher. According to the experiences of western developed countries, II plays an important role in stock market through enhancing corporate governance and keeping the stability and smoothness of capital market. Thus it is necessary to care about the role II has played in domestic stock market and for this reason we carry out this study.In this study , we use corporate performance to measure the quality of corporate government, using some empirical research methods such as regression to study how II influences corporate government efficiency. The sample of this research includes 223 listed corporations which have gone through the reform of non-tradable shares. We find that the ratio of the stocks owned by II is influenced by the ratio of floating stocks in total stocks. Besides, II is beneficial to the improvement of corporate performance. In detail, short-term II is the major II in domestic stock market and short-term II could attribute to the improvement of corporate performance. However, the influence of long-term II and QFII on corporate performance is not quite clear.