Japanese Enterpirse Financing Structure Analysis

Business activities can be divided into three categories: financing, operating andinvesting activities. Among them, the financing activity is the starting and key pointfor the activities of the enterprise, also is the survival condition of enterprise.Domestic and foreign experts and scholars have conducted many studies on enterprisefinancing activities,formed some theory,such as double M theory, trade-off theory,agency theory and the pecking order theory and other different capital structure theory,to guide enterprises to take financing activities. There are many similarities betweenChina and Japan,such as social and cultural background and the development ofthe economics. In Japan, the structure of enterprise financing played a significantrole in development, but also left some risk.The financing structure of enterprises inJapan can provide experience for Chinese enterprise financing activities, weshould also try to avoid the its problems.In my article, the first part gives the definition and the classification of thefinancing structure and related professional vocabulary, describes the capital structureof the relevant theory (including Modigliani Miller Models, trade-off theory, agencytheory and the pecking order theory). Then describes three stages of the evolution ofthe financing structure of enterprise in Japan, according to different financingstructure in various periods,also, combined with the five stages of Japan’s post-wareconomic development:The first stage is after the war until mid70’s,this period is thepostwar economy recovery stage and rapid growth stage. At that time, bank loans tooccupy the absolute dominant position in the Japanese enterprise financing structure.The second stage is from the mid70’s to the early90’s,in which Japanese economydeveloped stably and took on prosperity.In that period, the direct financing ofenterprises in Japan gradually began to develop, and gradually pinched the impact ofbank loans.The third stage is from mid90’s to now, Japanese economic recession,also known as the Japanese economy "lost twenty years".In that period,the financingstructure took great changes: The proportion of Securities financing and endogenousfinancing constantly rose,but the bank loans continue to decline. Throughout thehistory of development of the financing structure of enterprises in Japan, we can sumup some characteristics which is throughout the development of Japanese company: The first one is the high dependence on the bank loans.The second is the leading roleof the government significantly; The third is the folk financial institutions play animportant role; The forth is a diversified financing and financing structure reasonable.Then, this article analyzes the factors influencing the financing structure of theenterprises, mainly on the policy factors (including the industrial policy,fiscal policyand monetary policy), market factors and risk factors (including business risk andfinancial market regulation) three aspects to analyze the impact of financing structureon the enterprise.In the last part of the article,it Introduces the Japanese experience to perfectChinese enterprise financing,summarizes the financing structure of Japanese businessexperience and the problems, also shows that the financing structure of enterprises inChina and points out how to improve Chinese enterprises financing structure.