Research On The Over-investment Of Central Enterprises Under The Background Of Dividends Payout

"Paying Dividends to the people" is one of the important responsibilities of our central government-led enterprises. With the development of the enterprises, dividends payout is on the agenda. The government had issued dividends payout policy twice in2007and2010. It is a significant move in state-owned enterprises governance. However, as the absence of corporate governance mechanisms and supervision, there is serious asymmetry between principal and agent. The issue of the dividends policy will no doubt exacerbate the uncontrollability of central enterprises managers’ behavior. One of the manager’s uncontrollable behavior s is over-investment, and it is relevant to the appraisal system and income structure.Base on the analysis above, this paper establishes two models. Model Ⅰ shows that without the dividends policy, the behavior of central enterprise manager is influenced by appraisal policy; Mode Ⅱ shows that under the background of dividends payout, the over-investment of central enterprises becomes more with the raise of the payout ratio, and decreases with the increase of the control income ratio; the control income ratio has something to do with the degree of risk aversion and the environmental uncertainty.This paper uses listed companies data in the empirical study, and the study demonstrates that:(1) the efficiency of the central enterprises decreases distinctly. The impact of the leverage becomes negative after2007, and the investment effect of the debt capital is weak;(2) return on investment of Chinese enterprises is generally low;(3) in addition to central enterprises, the investment efficiency of other types’corporations has changed little before and after Year2007, further verifying that the dividends policy had significant impact on central enterprises. The leverage impact of the other types’corporations on the investment efficiency is inconspicuous. In order to further verify the influences of dividends payout policy on central enterprises, this paper conducts a case study on China COSCO Holdings Company Limited. And base on the analysis above, this paper put forward proposals accordingly.