Behavior Perspective Of Institutional Investors On Corporate Governance Impact Analysis

In the past 30 years, institutional investors in the main global capital markets have gained rapid development. As institutional investors have become the dominant force in the capital market, they are playing an increasingly important role in corporate governance. For a long time, there existes a lot of problems in the corporate governance, and the efficiency is very poor. The mechanism to restrict and stimulate have been out of function, which hamper the development of the listed companies and the whole market. In the recent years, with the rapid expansion of the scale of institutional investors, their active participation in the governance of listed companies to preserve their own interests and access to long-term investment returns will gradually manifesting itself. With more and more large-scale institutional investors entering the market, it's a forward-looking study of practical significance how to make institutional investors play an active role in the governance of listed companies in China.This paper analyzes the institutional investors, administrators and the relationship of them, especially from the perspective of behavior. And distinguishes the behavioral features of the relevant parts, especially the irrationality of investors and administrators. The paper also analyzes the impact of institutional investors on the two kinds of irrationality, and how the impact expanded to financing and investing decisions and the improving of corporate governance. The result of research shows that the institutional investors are not rational, but their positivity of taking part in corporate governance had improved. There still exists a lot of problems in the corporate governance, and the efficiency is very poor. The mechanism to restrict and stimulate has been out of function. The institutional investors still have no good idea to take part in corporate governance. Then the paper use the data of Shenzhen Stock Exchange in 2004 to find the current situation of institutional investors' role in corporate governance. The result reveal itself that the effect is not very established.