The Research On Corporate Governance Effects Of Debt Financing: Evidence From China's Listed Companies

According to modern capital structure theory, the financing policy of company does influence the value of the company. Through a long-term theory exploration, the theory of capital structure has been already relatively perfected. Domestic scholars carried on a large amount of research from the aspect of stock right structure and company management, and have drawn some more convincing theories. But there is relatively less research on debt financing. From debt financing eagle, the text attempts to research the current situation of debt financing and corporate governance of china's listed companies. An empirical research based on china's listed corporation is also conducted to test the governance effect of debt financing.The thesis firstly reviews the corporate governance theory and the capital structure theory, pointing out the logical relations between debt financing and corporate governance. On this basis, it then highlights the current situation of domestic debt financing and corporate governance, and comparisons are made between domestic and foreign situation. The corporate governance level is taken as the numerical of Tobin'Q, and liabilities-assets rate, debt financing rate, floating liability rate and fixed liability rate are considered as the explanatory variables to build the model. Using the data from 2004 to 2006, an empirical research is conducted to fully test the governance effect of debt financing. Results show that the debt has weak role on corporate governance in china's listed companies. We think it is because the recent defective economic system and the own shortcoming of listed companies, which negatively influence the mechanism of debt financing effects on corporate governance. Finally the thesis ends up with some suggestions to change the corporate effect of debt financing, such as reconstructing the relationship of bank-firm, perfecting the bankruptcy mechanism, ameliorating debt structure, developing the corporate bond market and manager market.