Empirical Study On QFⅡ And Corporate Performance Of The Listed Companies In China

With the developing of economic globalization, opening the capital markets has become aninevitable trend. As a limited control of opening the domestic capital markets to foreign investors,the QFⅡ system not only can avoid the loss of the opportunity to attract international capital dueto the closure of the domestic capital markets, but also can increase the utilization of foreigninvestment, reduce the impacts of short-term profit-driven capital on the capital markets,stabilize the exchange rate, and promote the healthy development of capital markets. China hasput the QFⅡ system into practice for nearly ten years. As the increase of the investment, QFⅡbecomes more and more active in Chinese capital markets. With the extensive managementexperience, professional team of financing and scientific strategies of investment, QFⅡ’s hasplayed an important role in improving the corporate governance and the performance ofcompanies.In this paper, the author firstly reviews the researches of predecessors on the relationshipbetween institutional investors and corporate performance and the QFⅡ system in China. In thisbasis, the author points out the defects of those researches and put forward author’s opinion.Then, the author introduces some basic theories about Corporate Governance. Next, the authorintroduces the definition and the development of QFⅡ system and analysis the motivation andthe ways of which the QFⅡ affects the Corporate Governance. In the empirical analysis, theauthor tests the relationship between QFⅡ and the corporate performance with the panel data ofthe companies which listed in Shanghai stock exchange and Shenzhen stock exchange from2005to2010. According to the results, in china’s A share market, the lagged1phase share of QFⅡ ispositive related with the companies’ performance. The results show that, QFⅡ can improve thecorporate governance through holding share, and than improve the companies’ performance. Atlast, the author suggests that Chinese’s government should improve the quality of listedcompanies and guide QFⅡ to take part in corporate governance.