Influence Of Internal Control Quality And Management Power On Listed Corporations’ Inefficient Investment

At this stage of economic background, high-efficiency investments can protect the efficient allocation of market resources, deal with sluggish exports and domestic consumer demand, be the key to stable economic growth rate. However, low investment efficiency existed in many listed companies.The specific performance of the abundance of investment and insufficient investment, resulting in China’s listed companies and inefficient use of resources, economic. It does not match the pace of development of capital markets. Therefore, this essay comes up with effective countermeasures to ensure the quantity of investment, which is needed an important problem.In this essay, the internal control quality, the management power and inefficient investment were first defined, then choose the theory of asymmetric information, agency theory and corporate property rights theory as the theoretical basis, find information asymmetry, the principal-agent problem are enterprises’ main causes of inefficient investment. Through theoretical analysis, respectively resaerch the influence of internal control quality, management power on the inefficient investment and make assumptions. This essay also deeply analyzes how different enterprise property rights affect the internal control quality, management power and inefficient investment behavior of state-owned and non-state-owned listed companies.In the empirical part, we propose for our company’s internal quality control measure, the use of principal component analysis synthesis management power integrated indicators, drawing on Richardson model specific measures expected investment level Inefficient enterprises to invest in accordance with China’s specific situation, were constructed with internal quality control, management authority for the explanatory variables to overinvestment and underinvestment as being explanatory variables multiple regression model. Select China’s Shanghai and Shenzhen A-share listed companies as samples for empirical testing. The main conclusions are:(1) High qualities of internal control can suppress enterprises inefficient investment.(2) State-owned enterprises improve the quality of internal controls for non-efficiency investments more pronounced.(3) The management power promotes inefficient investment of enterprise.(4) Non-state enterprises expand the powers of management on inefficient investment more pronounced.(5) Internal quality control reduces the degree of inefficient investment by inhibiting the management power.(6) high-quality state-owned enterprises more significantly reduce the degree of management power influence on inefficient investments.Finally, based on the results and conclusions of empirical analysis and theoretical basis, this essay makes recommendations:(1) External supervision departments should strengthen supervision system; the enterprise should strengthen the supervision of the implementation.(2) Improve the corporate governance structure; strengthen the management constraints and incentives.(3) Improve the reform of property rights.