The Research Of The Role Of Internal Control On Protecting The Minority Shareholders’ Equity In The Mixed Ownership Enterprise

With a series of financial scandals and subprime crisis and other events what make the market suffer great losses.the majority of investors have lost confidence in the stock market.And then investor protection,particularly the protection of minority shareholders’ equity caused more widespread attention.With domestic and foreign academic study further,they found that minority shareholders of listed companies being infringed frequently are closely linked to its internal control failure.With the construction of internal control system deepening,the economic consequences of the quality of internal control has attracted extra attention.Based on the close links between internal control and protection of minority shareholders’ equity,while responding to the strongly called for of party’s 18 vigorously develop a mixed ownership economy,and promote the healthy development of mixed ownership enterprises,to strengthening and perfecting internal control system of mixed ownership companies and solve the problem that minority shareholders’ equity are suffering frequency infringement,the paper explores the role of internal control on protecting the minority shareholders’ equity in the mixed ownership enterprise.The paper take the listed companies from 2012 to 2015 which in conformity with the definition of mixed ownership enterprises.as research samples,using the principalagent theory and other related theories and literature research method,text analysis method,statistical analysis method,and the analysis of induction,and combining with China’s current system and background,through empirical research it is concluded the following results:1.According to the principal-agent theory and so on three related theories,and based on the four main ways in which minority shareholders’ equity of listed companies are infringed frequently.analyzes the mechanism of action internal control’s five factors have on the protection of minority shareholders’ equity.and to use the quality of internal control establish four multiple regression models,respectively associated with associated guarantees,associated trade,agency cost and occupation of funds.combined with existing research by choosing the most representative variables to explain the degree of the protection of minority shareholders’ equity,reflecting the effect internal control has on minority shareholders’ equity in a better way.2.Using empirical analysis verify the relationship between internal control and the four aspects which measure the protection of minority shareholders’ equity,and classify the enterprises according to its proportion of shareholding to conduct a comparative analysis.3.Combined with the current Chinese system background,based on theoretical and empirical analysis,put forward policy recommendations from the reality.The innovations in this paper are as follows.Exploring the role of internal control on protecting the minority shareholders’ equity in the mixed ownership enterprise.Classifying the enterprises according to its proportion of shareholding to conduct a comparative analysis.And put forward the corresponding improvement suggestions according to their own characteristics.The research in the paper shows that in the mixed ownership enterprise,the high quality of internal control is beneficial to reduce the size of associated guarantee,associated trade and agency costs.And thus play a role in the protection of minority shareholders’ equity.Especially for the absolute state-owned holding companies,its internal control play a more active role compared with the state-owned shares of listed companies,but the role the occupation of funds plays remains to be research and improvement.Therefore,consummate the mixed ownership enterprise internal control system,to attract more investors,injecting more power into the enterprises to increase their operational efficiency and effectiveness.Thus under the favorable policy environment,to achieve rapid development.