An Empirical Research On The Relationship Between Power Balance With Shareholder Structure And Illegal Information Disclosure Behavior In Listed Companies Of China

In recent years, it's more often to see illegal information disclosure behavior in listed companies. We can see many information disclosure problems from Sichuan Jinding, Dikang Medicine, Hangxiao Steel to Hongguang Industry in Capital Market. Illegal information disclosure behavior brings not only the loss of shareholders, creditors and others related, but also huge social cost and economic cost. Therefore, study on illegal information disclosure behavior is not only the key-point which supervision department, academia and investors should pay attention to, but also the hot topic for further regulating information exposure and perfecting information exposure supervision system.The deep reason for illegal information disclosure behavior is that there are defects in the corporate shareholder structure. Overseas scholars commit themselves to study the relation between power balance with shareholder structure and illegal information disclosure behavior, and have got a lot of achievements, approving that power balance with shareholder structure indeed influence illegal information disclosure behavior to some extent, but there is no consensus for empirical conclusion. Because China's capital market and listed companies are different from overseas companies in the aspects of system background and intrinsic features, overseas research could not explain and predict China's capital practice. In China, the study on relation between power balance with shareholder structure and illegal information disclosure behavior is not systematic, lacking empirical data and in front of split share structure reform. In this case, in the light of China's special system background and the listed companies'details, this paper tries to research the factors influencing illegal information disclosure behavior of China's listed companies in the viewpoint of shareholder structure.The paper uses empirical research in main, supplemented with normative research and divided into five chapters:This paper introduces the research background and significances, reviews the literatures in the related fields, and explains the research frame, study methods and the innovations of this paper.Firstly, this paper introduces standard system of information disclosure and its features in different stages. Under the background of it, this paper studies on the status of information disclosure from 2001 to 2008, especially the shareholder structure behind of the problems.Secondly, this paper explains the institutional reasons of ownership concentration and private benefits of control, as well as economic basis and mechanism. Meanwhile, this paper discusses about the influence from both ownership concentration and power balance with shareholder structure, which is the basis of empirical study.Thirdly, based on the former analysis, the hypothesis is proposed from two aspects:the ownership concentration and power balance with shareholder structure. Then the paper chooses some A-share companies as the sample firms whose information disclosure is illegal during 2005-2008, and pairs them with control samples. In the following, the paper using descriptive statistics analysis and logical regression to test the relativity of power balance with shareholder structure and illegal information disclosure behavior.Finally, this paper analyzes the interrelation between power balance with shareholder structure and illegal information disclosure behavior deduced by previous empirical results in the light of real conditions of China's listed companies. And based on this, this paper proposes some policy suggestions on how to perfect shareholder structure in order to control illegal information disclosure. Then this paper concludes the research achievements, states the shortcomings, pointing the direction of deepening and widening for further research.This paper makes a systematic research on factor influencing illegal information disclosure in the viewpoint of power balance with shareholder structure, with following contributions:1. choosing the viewpoint of power balance with shareholder structure hits the point better and fills the blank of China's empirical study in this field.2.The conclusions of this paper are suitable for China's listed companies:(1) Before the illegal behavior exposure, the companies are different from the control samples. The share proportion of first stockholder is very high and the power balance with shareholder structure is very weak. Meanwhile, non-state enterprises occupy a large proportion of illegal information disclosure companies. The state-owned enterprises are not only regulated by the CPA, but also the government. (2) Ownership concentration promotes the illegal information disclosure in a certain extent. This shows that the controlling shareholders are lack of effective internal oversight and external oversight are often "pro forma" basing on interest conflict. (3) There is no significant correlation between controlling shareholders and the illegal information disclosure. (4) There are closely relationship between illegal information disclosure and tunneling which is the authentication of the second agency theory. (5) The lower power balance with shareholder structure is, the higher possibility of illegal information disclosure. (6) There is no significant relationship between similarity of the first and the second shareholders and illegal information disclosure.Because of the limitation of author's academic knowledge and some objective restriction, in this paper, there are some shortcomings on theoretic foundation, settlement of research samples, width of research area and robust research method, which need to be improved.