On The Ownership Structure And Corporate Performance

China has been achieving great economic success for more than twenty years. It has created lots of markets, including a stock market. Although these markets are imperfect, they have formed a foundation, on which the state-owned enterprises could reform further. Both government officers and enterprise operators realize that it is very important for the performance of the state-owned enterprises to establish a modern enterprise system, especially to clarify property rights. However, the effect of the reform is not so obvious on those listed state-owned enterprises. On the contrary, the listed companies' income on the whole is gradually lowered every year. The majority of the listed companies are state-owned enterprises. Overall the listed state-owned enterprises are among the top state-owned enterprises. The low corporate performance is due to the unreasonable equity ownership structure.This thesis analyzes the equity ownership structure in three aspects: the insider ownership, the shareholding concentration, and the share ownership structure. Theoretically, the upper management ownership is representative of the insider ownership, because the upper management is able to gain residual claims by ownership, which can lower the cost of the moral hazard, promote diligences, and then raise corporate performance. Although the conclusions of the internal and external empirical researches are not consistent, it is a reality that the ratio of the insider ownership is too low. In order to make full use of the insider ownership, which is a promoting mechanism, it is necessary to increase the ratio of the insider ownership.The research on shareholding concentration is one on the necessity and the. format of the existence of the large shareholders. According to the extent of concentration, the shareholding concentration can be classified as high, low, or moderate shareholding concentration level. In theory, moderate shareholding concentration level is more helpful for corporate governance and corporate performance. However, theconclusions of the empirical researches differ a lot.The feature of share ownership structure in Chinese stock market is that the state-owned stock takes a major part among whole stocks, which has negative effect on function of the corporate governance structure. The empirical researches show that the ideal shareholding concentration is a moderate one, which will perfect the listed companies' governance structure and raise their corporate performance. In this concentration level, there must be relative holding shareholders and a juridical person acting as the largest stockholder.As the policy suggestion, the above concentration level has to be the target of the Chinese listed companies. To reach the ideal concentration level, there are several steps, including reducing state-owned stocks, increasing the circulated stocks, raising the insider ownership, making the juridical person the largest shareholder, perfecting the listed companies' governance structure, etc.In the end, this thesis examines the variance in empirical research conclusions in order to unify the way to do the further research and the way to measure the corporate performance.