Corporate Debt Financing Flexibility And Debt Financing Behavior

Faced with a rapidly changing market environment, companies must maintainfinancing capacity and resilience to maintain the survival and development, in whichdebt financing flexibility is a critical factor. Debt financing behavior of enterprises isone of the core issues of financial theory, and it impacts on corporate debt financingflexibility directly, which in turn affects by the flexibility of debt financing. Clearly,the relationship between debt financing behavior and debt financing flexibility isinteresting and significant in debt financing research, and the existing literature rarelyconsider the business process are facing uncertainty. Therefore, this paper added levelof business risk factors, with a view to develop and improve the financial flexibilitytheory future financial flexibility while promoting research on the impact of otherfactors capable of enterprise-level corporate governance, risk management, attractmore attention, but also for companies looking for better debt financing decisionsprovide a theoretical basis.This paper start with debt financing flexibility, review and sort out the existingresearch literature, propose hypothesis on the basis of the research of domestic andforeign scholars, take the A-share listed companies in Shenzhen and Shanghai during2011-2013as the study sample, and use statistical software SPSS17.0multiple linearregression correlation under conditions of full sample flexible debt financing andcorporate financing behavior. Because the enterprises’ purpose of using flexibility ismaking response risk, this article make grouping empirical test to operating atdifferent levels of risk under a different corporate debt financing flexibility in thedifferent tendencies debt maturity, then make conclusion of the research and proposepolicy recommendations.Through the empirical studies, we have found that enterprises maintaining debtfinancing flexibility is easier to raise debt capital from outside. When a low level ofrisk management, debt financing higher enterprises tend flexible short-term debtfinancing, debt financing flexibility companies tend to lower external borrowing;when a higher level of business risk, higher corporate debt financing flexibility tendslong-term debt financing, debt financing businesses tend not to flex the lower externalborrowing. Results of this paper enrich the research of the theory of financialflexibility, but also add a real debt financing decision factors for Chinese enterprises to provide scientific and reliable theoretical basis for decision-making and debt capitaldebt financing term choice.