Research On The Ownership Structure Optimization Of Urban Traffic Corporate Based On Checks And Balances

After entering the Post Non-tradable Share Reform Era, the level of China’s corporategovernance has been improved constantly, Corporate Governance Index 2011（CCGINK）reached the highest level of 60.28. As an important part of corporate governance, the researchof shareholder governance behavior is becoming the focus of attention in the academic andpractical circles. With the large increase in the number of shareholders and the increaseparticipation of minority shareholders, more and more scholars began to focus on shareholderoversight checks and balances, so the establishment of equity checks and balancesmechanisms becomes an important means of improving enterprise performance standardsandprotecting the interests of small shareholders. According to China’s "Transport second fivedevelopment planning" strategic plan, transportation companies will usher a "modestadvance" golden age of development in the next five years. To meet the overall trend ofinvestment scale increase and financing reform, transportation enterprises should graduallyestablish a equity checks and balances mechanisms, improve the level of of the managementefficiency and value performance.In view of this, on the basis of reviewing the related theories of equity checks andbalances, corporate governance and domestic and foreign research results, this paper considerthe shareholding structure status of Chinese urban transport company, do game analysis onconspiracy and supervision behavior of the majority shareholder, come to the conclusions thatequity checks and balances will help improve the level of the business value and performance.To further study how the main variables of equity checks and balances affect the value of theenterprise, this paper take all urban transport listed companies from 2007 to 2010 in Shanghaiand Shenzhen Stock Exchange as samples, select the main variable ROA and auxiliaryvariable ROE as the indicators of value and performance, by descriptive statistics, multiplelinear regression and correlation test, rerify the assumptions that if the correlations betweenequity balances variables such as the degree of equity checks and balances, equity ratio of thelargest shareholder, the equity differences of the two major shareholders, the degree of equitybalances, the nature differences of the two major shareholders and business value are justified.This study found that, the business performance of equity balance class is better than theclass of business ownership concentration, the business performance of concentration class isbetter than the class of dispersed ownership class in the urban transport industry. Meanwhile,the degree of equity checks and balances has a significantly positively relation to the level ofcorporate performance. The more balanced the equity distribution of the top five shareholdersis, the better business performance improves. If the proportion of the largest shareholderreduces appropriat, the performance level of business value will be improved.When the natureof the two major shareholders agreed, the performance of the enterprise value is better than its performance when the nature is inconsistent. However, there is not a significant effectbetween the gap of the first two largest shareholders and the performance of the enterprisevalue.With empirical results, this paper propose the suggestions that can optimize theownership structure of China’s transportation industry, consider to build the mechanism ofequity checks and balances from government, business and shareholders three levels inpractice. The implementation of checks and balances Behavior can not only control theviolations of large shareholders effectively, protect small shareholders and enterprise overallinterests from being infringed, but also achieves the target that enhance the level of thetransportation industry governance, reform the investment and financing system and improvethe policies and regulations. Establishment and improvement of equity checks and balancescan make the shareholding structure of transport companies developes towards a morescientific and reasonable direction, ultimately promote the "second five"strategic developmentgoals of the transport industry realize smoothly.