Research On The Financing Structure Of Chinese Private Listed Companies Based On The Perspective Of Ultimate Controlling Shareholder

The traditional corporate governance mainly pay focus on the agency conflicts between the enterprise owners and operators, but a large number of studies in recent years have shown that ultimate controlling shareholders are widespread in listed companies leading to the agency conflict with the minority shareholders which has already become the focus of internal corporate governance and have profound influence on the formation of listed company’s financing decision and financing structure at the same time. Through the analysis of the ultimate control in China’s private listed companies, we found that ultimate controlling shareholders achieve their control of private listed companies mainly through the pyramid or cross shareholdings method. Under the framework of the control right, ultimate controlling shareholders make full use of their ultimate control right, cash flow right and the separation between the two aiming to maintain their control and obtaining private benefits from that. They occupied the minority shareholders’ interests by virtue of invasion behaviors, thus exacerbating the agency conflicts between the two. Based on the perspective of ultimate controlling shareholders, this paper studied their impact on the financing structure of private listed corporation in China.Based on theoretical and empirical analysis, we found that:(1)the ultimate control rights of ultimate controlling shareholders are negatively related to asset-liability ratio of private listing corporation;(2) the cash flow rights of ultimate controlling shareholders are negatively related to asset-liability ratio of private listing corporation;(3) the separation degree of two rights of ultimate controlling shareholders are negatively related to asset-liability ratio of private listing corporation;(4) Under the control of ultimate controlling shareholders, the equity balance is negatively related to asset-liability ratio of private listing corporation;(5) Under the control of ultimate controlling shareholders, the management incentive is negatively related to asset-liability ratio of private listing corporation;(6)whether ultimate controlling shareholders play the role of the directors of the board or the chairman is negatively related to asset-liability ratio of private listing corporation.This article is divided into six parts: the first part is the introduction which introduced the background and significance of this study; the second part is the summary of theory introduced briefly in this paper; the third part is about the present situation of private listed companies in China and ultimate controlling shareholders; the fourth part and the fifth part are the empirical research and analysis based on the proposed hypothesis and research models we set up; the sixth part is the conclusion of this paper, and we put forward related suggestions accordingly.