An Empirical Study On The Relationship Between Ownership Concentration、 Outside Blockholders And Corporate Performance

The GEM board, which was held in October2009, is an important part of ourestablishment of a multi-level capital market, there are many different from the main boardand the board of small and medium-sized enterprises, so it is significant to study. Now theGEM is pushed in the teeth of the storm by the television, newspapers and other media reports.The listing companies of the GEM are suffering many problems, such as performance changeunpredictably, extracting money continuously. Also it is hard to root out the bubble in theGEM. In addition, super funds raise, embezzlement, fraud in financial statements in the GEMemerge in an endless stream.Compared with the main board, the GEM is mainly served for the high growth potentialof small and medium enterprises, and the stock is the full circulation. The GEM listingconditions are loose, but it is more strict in the information disclosure. The industrialdistribution of the GEM is different from the main board,and most listing companies lies inthe growth stage of the life cycle. The listing companies of GEM mostly are private, whoseownership is relatively concentrated in the first shareholder, highly concentrated in the topfive shareholders, the equity restriction ratio is low. The most actual controller of the GEM’listing companies are natural person or family. And it is common that the control rights are notequal to the cash flow rights.By empirical research,you will find the ownership concentration has the oppositerelationship with the corporate performance, and the outside blockholders has the samerelationship with the corporate performance,and the separate of the control rights and thecash flow rights has the opposite relationship with the corporate performance. Finally it is thesuggestions.It is not only the companies’s duty, but it is the government’s responsibility.Weshould weaken ownership concentration, and increase outside blockholders.We should perfectour legal system in order to protect the small shareholders and maitain the information fairand transparent. In addition, it is useful for us to expand and relarge the investment companyand investment fund.