The Influence Study Of Controlling Shareholder On Irrational Financing Preference Of Listed Companies

With the development of modern enterprises, financing decision has become an important element of listed corporations in management decision, Rational financial decision-making should be based on stakeholder interests , optimize the capital structure and eventually realize the maximizing of corporate value. Equity financing as a mean of our listed companies financing plays an important role in development of capital markets, An appropriate degree of equity financing not only increases the rate of capital utilization, but also is in line with the requirements of maximizing corporate value. But in recent years financial decision-making process is irrational in our listed companies, that is Over equity financing preference. When the listed companies determine the volume of financing, which are often in accordance with the"supply determines demand"approach, but not with the"demand determines supply"approach , and the results cause a lot of idle funds in our listed companies. The irrational financing not only reduces efficiency in the use of funds ,but also is not conducive to maximaization of corporate value.In this article,First I review the relevant research literature at home and abroad,and basing on Control Theory, Agency Cost Theory and the Pecking Order Theory, I describe and analyze the Status and characteristics of controlling shareholder and the irrational financing preference, the results show that our listed companies really exist the irrational financing preference, which causes undesirable phenomena of a lot of idle funds . Second I theoretical analysis the motivation of irrational financing preference from equity property and the proportion of equity holdings, and the result shows that the absence of the State-owned holding listed companies'main body causes the insider control of Manager, Managers in order to obtain benefits of control will inevitably lead to irrational financing preference; The high proportion of the controlling shareholder's stake easily lead to control problems of controlling shareholders, controlling shareholders in order to rapidly achieve the net capital value added and benefits of control will inevitably lead to the irrational financing preference, At the same time, I have empirical studies the impact of irrational financing preference from the equity property and the proportion of equity holdings of controlling shareholder , The results show that the equity property of controlling shareholders can influence irrational financing preference, but the effect is small, and state holding listed companies are more likely to irrational financing preference than non-state holding listed companies; the proportion of equity holdings of controlling shareholder can significantly affect the irrational financing preference, the greater the proportion of equity holdings of controlling shareholder, the more obvious irrational financing preference, at last I put forward policy proposals.