An Empirical Research On Companies Performance And Ownership Structure Under Shareholder Structure Reform

On 29 April 2005, the China Securities Regulatory Commission (CSRC) promulgated the Notice on the Trial Implementation of shareholder structure reform in Listed Companies and Related Questions, starting the pilot program to restructure share capital of listed companies by converting the non-tradable shares (NTS) into tradable shares. It is expected that the share capital segregation reform of listed companies will have basically completed by the end of 2006.In this paper, we did research on stockholders equity structure and corporate governance to compare 2004 and 2006 companies'performance; we chose the corporate which had finished the reform in 2005 as referent. And because these corporate had finished the reform for more than one year, they are now gradually removing the ban on non-tradable shares, and the effects of reform start to emerge. At the same time, considering the stock not full-circulation, we select ROE. We did regression test to the 220 valid samples fully considering all reasons relate to the corporate governance efficiency.After that, by comparing the regression result of 2004 and 2006, we find the newest conditions of stockholders equity and corporate governance:the increasing floating stock promotes'performance of corporate is limited; Institutional investors can help to enhance the validity of Corporate Governance; large stockholders can help to improve corporate governance. Although reform has many advantages, from the empirical result the reform is not deep enough.From the empirical result, the reform of Segregation of Share Capital in Listed Companies has an important effect on improving corporate governance level. And there are still some problems after therefore, at the end of the article, some suggestions are proposed to make the corporate governance of Listed Companies expecting the times of full circulation.