An Empirical Study Of The Relationship Between Ownership Structure And Corporate Performance From The Perspective Of The Life Cycle

With the establishment and development of the modern joint-stock enterprise system, many foreign scholars have done some researches on corporate governance.With the growing of joint-stock company in the70s and80s of the20th century, there are more and more new topics to research on corporate governance, such as:how to prevent the corporation from being taken over effectively, how to supervise the management of the corporation effectively, and how to prevent The largest shareholder from occupying the interests of minority shareholders.Because of these problems, foreign scholars started to focus on corporate governance, and the relationship between ownership structure and corporate performance is one important aspect.China began to research on the theory of corporate governance in the1990s, Compared with that in Western countries, China has unique problems of corporate governance to deal with. Especially the research on the relationship of ownership structure and corporate performance, we should take more attention on some aspects:such as:1, state-owned shares proportion is huge and ownership of it is unknown, agency costs, inefficiency;2,dominance phenomenon;3,how to reform the situation of split share structure;4, how to improve and regulate the capital market rules.There are a lot of theories in the study of the relationship between ownership structure and corporate governance, which could be summarized as:a positive correlation, negative correlation, U-shaped, inverted U-shaped relevant.The theory of company’s life cycle originated from corporate management firstly, marketing strategies from the perspective of qualitative analysis. Recently the theory of life cycle is used to the financial management of the enterprise, such as:capital structure, financing strategy, cash dividends and so on. It is a relatively new topic of Using Life cycle theory to the area of corporate governance. Based on these reasons, I am going to research on the relationship between ownership structure and corporate performance from the perspective of life cycle in this article. I hope others can get some useful advices.This paper is divided into five parts:Chapter Ⅰ:Introduction. Firstly, I gave a brief introduction of the research on the relationship of ownership structure and corporate performance at home and abroad and China manufacturing. Secondly, I gave the purpose and significance of the topics. Finally, Ⅰ introduced the research methods and content framework.Chapter Ⅱ:A Literature Review. In this part, we review related literature at home and abroad, including:lifecycle, evaluation of corporate performance, the relationship between ownership structure and corporate performance. I can found a basis for the following empirical analysis in this part.Chapter Ⅲ:Theoretical Analysis. In this part, I gave some introduction of theory about life cycle、corporate governance and ownership structure.Chapter Ⅳ:Empirical Test. On the basis of literature review and theoretical analysis, I came up with hypothesis.set variables, and I gave descriptive statistics and correlation analysis about variable. Finally I set a modeling to do empirical analysis.Chapter Ⅴ:Conclusions、recommendations and research outlook. In this part, Ⅰ gave the interpretation of relevant empirical results, and some advices about corporate governance. In the end, I gave the deficiency of this article and research outlook.Through empirical research, we draw the following conclusions:(1) The correlation between the ownership structure and corporate performance in the different life-cycle are different. It illustrates that it is necessary to classifying enterprises in accordance with the business cycle.(2) About the ownership concentration. Enterprises in different life cycle stages face different risk, and they have different strategic objectives. They could prove their business performance only they form a corresponding ownership concentration,.For growing enterprises, the relationship between ownership concentration and corporate performance is positively. For the enterprises of mature stage, the relationship between ownership concentration and corporate performance is inverted U-shaped(3)About equity balance degree, the relationship between equity balance degree and corporate performance is inverted U-shaped. So enterprises should keep a appropriate balance of equity, the companies need to determine the life cycle firstly, and then they should consider a fit equity balance degree.(4)About property of ownership. It includes state-owned shares and legal person shares and outstanding shares. Different shareholders have different demands, so they will have a different impact on corporate governance. According to the Empirical results:1, for growing enterprises, the higher ownership of state-owned shares is, the worse company performance is.So is outstanding shares. and there are no obvious relationships between company performance;2,For the mature firms, the state-owned shares、legal person shares and tradable shares have no significant effect on corporate performance.(5)About state-controlled company. From the empirical results:there is no significant effect on corporate performance. Which is not matched with the assumptions previous-the state-owned holding company has a poor corporate performance.Through the empirical analysis, I would like to come up some suggestions in the end of article:we should have a dialectical view of equity concentration; companies should maintain an appropriate ownership concentration; the growing enterprises should properly reduce of the proportion of state-owned shares; plus, we should refine and improve the rules of the capital market.I hope these suggestions will be useful to improve corporate governance.