The Research On Conflict And Balance Of Interest Between Shareholders And Creditors Based On Contract

Debt financing is an essential link to business development, Due to the interests of shareholders and creditors are not always consistent, so conflict was inevitable between the two sides that includes hidden forms and inspire forms. There are motivations for shareholders to violate the interests of creditors through many ways. Creditors will sign contracts to checks and balances shareholders in order to safeguard their own interests. Under ideal condition, under the constraint of laws, shareholders and creditors can solve this problem by signing contract, but only if creditors have access to reliable information、developing complete contract and shareholders compliance with provisions of the contract fully. But the actual is the ideal state is difficult to achieve because of incomplete information, shareholders often against interests of creditors. Though shareholders and creditors signed a contract, but shareholders often do not fulfill the contract to against the interests of creditors.In this context, there are a lot of research about conflict of interest between shareholders and creditors, but the majority was from the point of creditor’ protection, analysis on the conflict of interest between shareholders and creditors based on contract and from the perspective of game theory is less.Based on this, this article is mainly based on the perspective of contract and from the perspective of game theory to analysis the conflicts of interest between shareholders and creditors. Using game theory to analyze the causes of contract’s conflict and analyze the game process statically and dynamically. The paper understands the process of achieving balance interest fully to identify factors that affect the interests of both sides. That is factors that affect the benefit of creditors and shareholders. At last, the paper submits suggestions and countermeasures to achieve the balance of interests between shareholders and creditors, including internal and external measures, with a view to provide some references to coordinate the relations of interests between shareholders and creditors. This will play a very important role for the company, shareholders and creditors.