Empirical Study On The Relationship Between Governance Structure And Equity Agency Costs On The State-owned Holding Listed Companies

China’s state-owned holding company is an important form of asset management,playinga very crucial role in the state-owned assets management system.State-owned holdingcompany not only ensure continue operations,maximize profits, but also ensure thepreservation and appreciation of state assets.State-owned holding company locate in theeconomic sectors,to safeguard that national economic security and technological innovationplays an important role.Therefore, as outstanding representatives of Chinese enterprises,thestate-owned holding company’s corporate governance relates to the overall development ofChina’s enterprises,so studying the corporate governance of state-owned holding company hasimportant guiding significance.At present, China’s state-owned listed company’s governancestructure appears more and more problems, mainly in the controlling shareholder of thecompany’s absolute control over the lack of democratic decision-making,not to protect theinterests of minority shareholders, etc.All indications have shown that it is imperative that thestate-controlled listed companies improve governance structure.the special ownership structure of state-owned holding listed companies has brought aspecial equity agency costs issues, especially the agency problem between shareholders andmanagers particularly prominent, equity agency costs issues severely restrict the developmentof the company. Therefore, how to reduce agency costs and solve the agency problem hasbecome an important issue to explore domestic and foreign scholars. In this paper, theresearch literature on governance structure and agency costs at home and abroad for analysis,the study found that most scholars agency costs from the ownership structure and boardgovernance, rarely governance structure of listed state-owned holding company systemanalysis, and agency costs of equity in-depth analysis is even more rare. Therefore, this paperdrawing on the basis of previous research to the study of China’s state-owned holdingcompany listed on paper, the relationship between state-owned listed company’s governancestructure and equity agency costs theoretical and empirical analysis. Corporate governanceindicators used in the article will include ownership concentration, equity restriction, theproportion of state-owned shares, the board size, the proportion of independent directors, senior management and executive compensation number of holdings, and I will measure theequity agency by managing operating expense ratio. Firstly, the various indicators ofcorporate governance is the autocorrelation analysis, selection of no autocorrelationrepresentative indicators and regression analysis, and concluded that China’s state-controlledlisted company’s equity restriction, the proportion of state-owned shares, executives numberof holdings and executive compensation and equity agency costs are have a strong correlation,and the relationship between the Board and equity scale is not significant agency costs, theproportion of independent directors and equity agency costs are not relevant.This article does not draw the relation between the proportion of independent directorsand agency costs, the reasons may be that the major shareholder of state-controlled listedcompanies tend to be state-owned assets management department, the election of directorsalso tend to reflect the willing of the majority shareholder, the internal controlled quite beserious, so the independence of independent directors is not strong. What’s more, it is the flawof independent director system, it is necessary that we regulate the remuneration ofindependent directors. Based on theoretical and empirical analysis, this paper presentsrecommendations,including improving the state-owned assets management system,optimizing the shareholding structure, strengthening directors functions to build the perfectincentive and restraint mechanisms, with a view to improve the corporate governancestructure, reducing agency costs of equity improve governance efficiency of state-ownedlisted companies.