Study On The Financing Risk Of Major Shareholders' Equity Pledge Of Coship Electronics

Most of the listed companies in China have relatively concentrated equity.Therefore,the principal-agent problems on corporate governance need to turn the conflicts of interest between major shareholders and managers into the conflicts of interest between major shareholders and minority shareholders.When to seek their own interests for the purpose,major shareholder's stake win higher status,affects the operation and development of listed companies and stakeholders of investment decisions.At present,major shareholders of listed companies share equity pledge frequently.Major shareholders can use equity pledge the financing channels to obtain major sums of money in a short time without needing to transfer its equity.During the period of equity pledge,major shareholders transfer equity share price volatility risk to the pledgee.This prompted the major shareholders occupy motive,harm the legitimate rights and interests of the listed companies and stakeholders.Therefore,the major shareholders' equity pledge problem has great theory value and practical significance.This paper analyzes the coship electron major shareholder equity pledge financing behavior of listed companies and the risks of stakeholders.First,this paper introduces the research background and research significance of this article,and from the major shareholders equity motivation,financing risk identification and measurement and equity pledge financing risk countermeasures from three aspects to review and summarize research results of predecessors;Second for defining the relevant concepts and theories and expounded,and from two aspects of equity pledge system and information disclosure system,this paper introduces the system background;Again,introducing the coship electronics major shareholder equity pledge,the process of combining with the existing literature and actual situation,this case belongs to major shareholders' motivation to obtain interests;Finally,we identify the financing risk of major shareholder equity pledge,and provide the conclusions and policy recommendations with financial performance index method and equity loan-to-value ratio of VaR method.Case study results show that due to major shareholders equity pledge its control and the separation of cash flow rights,causing major shareholders have grab self-interest motivation,finally emptied the company.Under this kind of motivation,the major shareholders not only posing a risk to the operational and financial environment for the company,but also infringes the interests of stakeholders and influence the decisions of investors.In order to reduce the major shareholders using equity pledge financing behavior of the financing risk,this paper puts forward the following suggestions:(1)to strengthen the internal governance of listed companies,perfecting the system of company of major shareholders equity pledge,completes the corresponding risk early warning and response mechanism;(2)to give minority shareholders and stakeholders more say;(3)to further improve the system of big shareholders equity pledge of norms and the corresponding information disclosure system.