The Empirical Research On The Relationship Between Board Characteristics And Enterprise Financial Risk

Financial risk is an objective reality and related with the survival and development of enterprises, itis one problem that enterprises must face. It is necessary for the enterprises to take measures to studyfinancial risk and reduce losses.The factors that affect financial risk include both internal factors and external factors, but the mainfactors are internal factors. The board characteristic is one of the very important internal factors. Inorder to minimize the enterprise financial risk, we introduce the characteristics of the board to thestudy of financial risk and found the relationship between board characteristics and financial risks,then adjust the board structure to make financial risk to a minimum.Based on stewardship theory, substitute theory, resource dependence theory, internal control theory,asymmetric information theory, portfolio theory, interests of the convergence theory and interests ofthe predatory theory, referring to the related research method and conclusions at home and abroad,making combination with the actual situation of the listed companies of the manufacturing industry ofJiangsu province, this paper puts forward the research hypotheses to find out the relationship betweenboard characteristics and enterprise financial risk. The board characteristics variables are the scale ofboard, the frequency of board conference, the proportion of independent directors, whether thechairman of the board and general manager are the same person, the proportion of directors who holdshare, the remuneration of the directors. The research shows that the frequency of board conference,whether the chairman of the board and general manager are the same person and enterprise financialrisk are in significant negative correlation, the remuneration of the directors and enterprise financialrisk are in significant positive correlation, the scale of board, the proportion of independent directorsand the proportion of directors who hold share have no obvious influence on enterprise financial risk.According to the above conclusions, the paper put forward some suggestions to improve the boardstructure of listed companies in China and reduce enterprise financial risk.