An Empirical Study On The ’Tunneling’ Of The Controlling Shareholders Of The Private Listing Corporation Of Six Central Provinces

Most of the listing corporation equity in China is relatively concentrated.Shareholders tend to use their voting rights to control the board of directors andthe company’s the investment decision-making, the management policy and thefinancial planning. So it is easy to cause the conflict of the interests betweencontrolling shareholders and small shareholders. But because of thediversification and the concealment of the ‘tunneling’ of the controlling shareholders,to measure and supervise their private benefits is always a difficult problem. Throughthe empirical study on the ‘tunneling’ of the controlling shareholders of the privatelisting corporation of six central provinces, it is helpful to realize the maximization ofthe enterprise value, to safeguard the legitimate interests of small shareholders, also tothe management and supervision of the relevant government departments.This article mainly from the origin of the ‘tunneling’ of the controllingshareholders, the influencing factors, the main way, the consequences and otheraspects analysis the related domestic and foreign literatures. Then, define the relateddefinitions, and in-depth analysis on the theoretical basis of this article, the presentsituation, the reasons and the metric method of the ‘tunneling’ of the controllingshareholders of listing corporation. Then, Based on the OLS regression model ofempirical to research2009—2011years of the ‘tunneling’ of the controllingshareholders of the private listing corporation of six central provinces of China.Finally, this paper put forward the regulatory measures of the ‘tunneling’ of thecontrolling shareholders of listing corporation, the limitations of the study and putforward the prospects for future research combining with the status of six central provinces’ listing corporation’s equity.The research results show that:2009—2011years of non legitimate private ofthe ‘tunneling’ of the controlling shareholders of the private listing corporation of sixcentral provinces of China are2.32%,7.65%and3.27%, and the average value is4.41%. The research results is higher than the private of the ‘tunneling’ of thecontrolling shareholders of the western developed countries. There is a positivecorrelation between the value of TobinQ, the rate of asset and liability and the privatebenefits of the ‘tunneling’ of the controlling shareholders. There is a negativecorrelation relationship between the circulation stock proportion, the rate of return onnet assets, net assets per share and the private benefits of the ‘tunneling’ of thecontrolling shareholders. The independent directors did not play its due role. In thisregard, the relevant departments should focus on monitoring these listing corporationswhich are higher of the TobinQ value and rates of assets and liabilities, lower of theproportion of tradable shares and the rate of return on net assets and net assets pershare. At the same time, to implement the registration system about independentdirectors and independent supervisors, to perfect incentive and punishment systemabout the board of directors and board of supervisors, and to establish and improvethe protection system of the independent directors and supervisors. To perfect thesystem of the information disclosure, to establish and perfect the credit system. Usethese measures to constraint and restrict the ‘tunneling’ of the controlling shareholdersof listing corporations of China.