Empirical Study Of The Influence Factors Of The Listed Companies’ Senior Management Reduction Of Stocks

In the October23,2009,10years of planning for the GEM board official openingceremony was held in Shenzhen. GEM is a second board stock market second only tomotherboard market. The main purpose of setting the GEM is to support SMEs,especially those with high growth capacity of enterprises. By the end of2013, there are355companies landing GEM. The size of GEM market continues to grow, along withsome of the questions that need to be improved constantly. One of prominentphenomenon is that company executives reduce large-scale stocks frequently.Accordingto statistics, the reduction of the intensity of executives from2010to2013showed arising trend. This phenomenon will shake the establishment mind of the GrowthEnterprise Market, impact the management of companies listed on GEM, Is notconducive to the healthy development of the capital market and dampen the enthusiasmof the public investors. In this paper, it will conduct research, and explore the factorsbehind this phenomenon.The overall structure of this paper is divided into six parts：Introduction. It introduces the background and significance of the study, the relevantdomestic and international literature review, research methods and content.The first chapter is the background and theoretical basis of executive’s shareholding.It is turning to the emergence and development of senior management holding of stocks,as well as the policy basis in China. And it describes the theoretical basis for seniormanagement holding of stocks form entrusted agency, incentive mechanism and humancapital.The second chapter is the analysis of current situation. It analyses the overallsituation of reduction of executives, the proportion of the reduction of executives andsenior individual holdings. It also introduces the features and the way of seniormanagement reduction of stocks and the negative effects of senior management reductionof stocks.The third part is listing study design of senior management reduction of stocks. Thesamples of empirical research, variables and assumptions are introduced.The fourth part describes the empirical study of influence factors of the senior management reduction of stocks. This article extracted principal component. Secondly, Ido regression analysis empirical research to find the factors.In the end, it concludes the paper and makes recommendations. Finally, it givesrecommendations based on the theoretical analysis and empirical research from thecompany angle and the regulatory perspective which will promote the healthydevelopment of the GEM.