Research Of Management Characteristics And Capital Usage Efficiency Of Listed Company

With the fast economic development, improving the value-creating ability by increasing capital usage efficiency is very important for a company’s living and development under the fierce market competition. In these years, large numbers of inefficient investments occurred in our country because of the pursuit on fast expansion of listed companies. Some companies turn to fast expansion without full demonstration of profit and risk. The irrational investment impulsion of listed companies in our country will bring significance business risks. For this reason, it is important and also necessary to study how to improve the capital usage efficiency.With asymmetric information and agency conflict, management layer have chances and intensions to make adverse selections for their own benefit but ignore the shareholders’interests. Particularly in our country, more listed companies are state-controlled listed companies. The very complicated management of agency makes effectiveness of corporate governance very low, and there are serious problems in capital usage agency. There for, given the situation that overinvestment exists ubiquitous in our country, it becomes an serious subject to establish an efficient corporate governance mechanism based on management layer characteristic, so that they can make up efficient investment plan and improve the capital usage efficiency. In the paper, listed companies are chosen as object, built a theoretical model by statistical method, empirically tested and analyzed the influence of every index in management layer characteristic on capital usage efficiency. The value-added rate (economic value added/capital sum) was chosen as quantitative index of capital usage efficiency. We chose four main index of management layer characteristic to test their influence on capital usage efficiency. We also analyzed the current situation of capital usage efficiency of listed companies in our country, confirmed their lack of ability on value creation and inefficiency on capital usage inefficiency.After the empirical research and analysis on management characteristics and capital usage efficiency of public companies, we found that such characteristics as board size, managerial compensation and management shareholding are positively related to capital usage efficiency, whereas the average age of managers does not influence the efficiency very much. In China, public companies bind the management layer and company benefit together by salary and stock ownership incentive. This pushes the management layer to make profits by increasing the capital usage efficiency. Expanding the board size within the legislation could make restriction to each other, thereby the over control of any strong stock holders would be avoided. Besides the governing efficiency will be higher with more job involvement, which promotes the increase of capital usage efficiency. The average age of managers does not have any obvious impact on capital usage efficiency. This means the average age of managers has no influence on the management. Therefore, by expanding the board size, increasing the managerial compensation and applying stock ownership incentive, public companies can enhance and upgrade their corporate governance structure, establish constraint mechanism inside corporation and incentive system, and finally establish the governance mechanisms that can increase the capital usage efficiency.