The Research On The Corporate Governance Impacts Of Institutional Investors On The Performance Of M&A

With the developing of institutional investors,they are playing an increasingly important role in the capital market.The relationship between institutional investors and corporate governance is also becoming a hot topic among the scholars at home and abroad.There are already many researches which have found that institutional investors do play a postive role in corporate governance so that benefit the performance of the firms.But do institutional investors also have impact on corporate governance when making an M&A decision?Is there any connection between their effort of monitoring and the performance of M&A?As a matter of fact,there are not many scholars who concentrate on the questions above in academia.This paper tried to take M&A,which is one of the important external governance mechanisms of corporation,as cutting point to analyze the impact of institutional investors on M&A performance and find supplementary evidence for institutional investors' positive role in corporate governance.This paper not only made researches about the impact of institutional investors on corporate governance more abundant,but also helped policy-makers and small stockholders realize the positive role institutional investors play in corporate governance and boost the further development of institutional investors.This paper firstly reviewed the literatures on the performance of M&A and the relationship between institutional investors and corporate governance.On the basis of the agency theory,the stakeholder theory and the corporate governance theory,this paper analyzed how can institutional investors improve the performance of M&A,and put forward several hypotheses.Based on the M&A happened from 2009 to 2013,buyer companies as the initial sample,after filtering and sorting,906 samples were included.This paper used both event study method and accounting study method in measuring M&A performance,used institutional investors shareholding to represent institutional investors' corporate governance function.In order to test the hypothese,least-squares linear regression was used,and finally reached the following conclusions:(1)Institutional investors as a whole showed a significant effect on promoting the performance of M&A;(2)Different types of institutional investors had a different effect on M&A performance.ILTIs(independent long-term institutions)had a significantly positive impact on the performance of M&A.While UILTIs had no substantial impact on M&A performance;(3)Institutional investors' fuction of corporate gorvenance played a positive role in M&A with related party.However,the research on ILTIs didn't come to the same conclusion.(4)Both total institutional investors and ILTIs can benefit state-owned corporations' M&A performance.