The Empirical Study On The Relationship Between Ownership Characteristics And Listed Corporation Fraud

In recent years, a serie scandals of listed companies let investors suffer in huge losses, disrupt the financial order of the securities market, and hinder the healthy development of the securities market. Therefore, research the influence factors of fraud of listed companies has a positive significance.However, the author observed a phenomenon in securities market:namely whether investors or supervisors, there is an attitude that "softhearted to state-owned enterprises but hardhearted to private companies". And the author calls it "characteristics of equity effects". At present domestic in view of the relationship between ownership characteristics and fraud of listed companies research is relatively fragmented. Therefore,from the angle of ownership characteristics to study its irregularities impact factors is a more novel point of view..What is the relationship of the probability of listed companies’ fraud and ownership characteristics? Ownership concentration or dispersion, which is better? Do conflicts of interest between big and small shareholders constraint the behavior of listed companies? Do the characteristic of the first majority shareholder and ownership affect the violations of listed companies? In this paper, it will explore the series of problems in order to control the listed company illegal behavior to provide empirical evidence of ownership characteristics.(1) Research contentBased on the violation of A stock market in2012, A total of289listed companies as the research sample, according to certain principles of randomly selected289not offending companies as control samples. This paper studied on the capital market reaction with ownership property as the classification basis. They are also violations, but there is a significant difference of their share price changes, because of the different characteristic of the ownership. Then explained the causes of differences, and, in turn, lead to the irregularities are influenced by what other ownership characteristics, too. Then put forward the hypothesis, and build logistic regression model by SPSS. Finally got the conclusion and put forward some countermeasures suggestions according to the conclusion. In conclusion, this paper contains five parts, the content is as follows:Chapter1:Introduction. This part elaborated research significance, research methods, main content and innovation points and summed up shortcomings.Chapter2:Literature review. Through to the representative’s review of theory and practice both at home and abroad, expounded the current situation of China’s listed companies irregularities, clarified the relationship between ownership and irregularities. Finally draw a summary and evaluation to the literature.Chapter3:The empirical characteristics of equity effect. Build the model of discriminant of characteristics of equity effect; study the different characteristic of the ownership of violations of listed companies on the capital market reaction research, proved the violations of the securities market’s share price has a certain impact, analyzes the causes of these differences and leads to the next chapter irregularities are influenced by what ownership characteristics.Chapter4:Ownership characteristics affect listed corporation fraud. Put forward the hypothesis, build the model and analyzed the results.Chapter5:Conclusions and Suggestions. In view of the former chapters research conclusion, puts forward the countermeasures suggestions of optimization of ownership structure and for the prevention of the listed company illegal.(2) The conclusion①The reaction of capital market:The average cumulative excess return rate of fraud of listed companies is negative, but the average cumulative return on the market is positive, and by the mean significant at the0.1level test, illustrates the effectiveness of stock market, that is violation notice release has a negative effect on violations of listed companies.Although the fraud notice has negative effect on the fraud companies, but the effect is different. From the view of ownership properties, state-owned enterprises and private companies on average total return is negative, but state-owned CAR (-3,3) value is far above private. And state-owned CAR (-3,3) didn’t pass the significance test, prove its cumulative excess return is not different from the market yield. However, private CAR (-3,3) passed the significance test at the0.1level, showed that although they are same fraud, but due to the properties of the ownership of listed companies, investors are more inclined to trust and forgive the state-owned enterprise, investor confidence in the state-owned enterprises obviously stronger than private enterprises.②Ownership characteristics factors of listed companies fraud:The two variables of ownership property,"FCSH" didn’t pass the significance test, shows whether violations of listed companies with foreign ownership participation is no significant relationship, but its coefficient is negative, may be due to a dominant are widespread in our country, foreign shareholder just passively participate in corporate governance, it is difficult to supervise the controlling shareholders play a powerful role. The variety "Character" has passed the test of significance, but its sign is contrary to expectations, shows the first largest shareholder and the second largest shareholder are the same nature, the lower the probability of fraud. It also illustrates a dominant in our country’s special background, the second largest shareholder can difficult to suppress the first big shareholders.The two variables of ownership concentration both have passed the test of significance, which verified the higher the proportion of the largest shareholder, the greater the chance of fraud of listed companies; The higher the proportion of outstanding shares of listed companies, listed companies the possibility of irregularities is lower.The variety "DifferenceSH" has passed the significance test at the level of0.05, which verifies the DifferenceSH lager, the greater the possible violations of listed companies;The variety "ManagerSH" has passed the significance test at the level of0.01, and the coefficient is positive, on the one hand shows executives shareholding ratio and probability of listed companies is highly related; on the other hand, ownership incentive measures in our country does not have the effect of positive incentives, needs to be improved and perfected.(3) Innovation①Chose a different approach:research violations of listed companies from the angle of view of the characteristics of ownershipPredecessors in the studies of the securities market of the listed company’s share price shocks, on the basis of the number of divisions of different window sample, to study the duration of the securities supervision. Study organization effectiveness of punishment, and the units which give punishment (SFC, Stock exchanges, or other local organizations) to see the company’s stock price impact, and this paper is based on nature of the ownership division sample basis, from another angle of view to explore investors reacting to violations of listed companies in the capital market.②As the research sample selection to the matching company as the control sample, and the matching principle is more scientific and reasonable.Previous violations on the study of the listed company, the selection of matching samples, ignore the size of the enterprise itself is also a factor, when selecting a control sample, to keep the company size is consistent artificially. But this paper is no difference in the size between irregularities sample and control sample artificially, the conclusion is more accurate, more scientific.(4) Limitations:①This paper is based on the listed company once has irregularities, can be investigated under the ideal assumptions. But due to the number of illegal dark, the actual violations of listed companies is not the same as regulators to investigate and punish violations, which leads to the object of study is not comprehensive, scale research scope is narrow, the conclusion is not accurate.②The part "the reaction of capital market" of this paper is based on the premise condition "the market is efficient and investors are rational", but in fact our country securities market is not so efficiency, and the speculators are so many on the market, so there is noise in price, the authors haven’t come up with noise reduction methods.③It can do more in-depth research on the study of ownership concentration. Such as the all samples can be divided into excessive dispersion, moderate, excessive concentration of three samples according to the degree of ownership concentration, but due to time rush, the energy is limited, no more in-depth research.④It can also compared the characteristics of ownership of fraud of listed companies before and after ownership division reform. But the workload of data collection and others is so heavy that the author gave up such a contrast research.