Research On The Impact Of Financial Flexibility On Corporate Investment And Efficiency

Since 2014,China has proposed to accelerate the development of multi-level capital market,multi-level capital market system constantly speeds up construction.In2017,the government work report puts forward to deepening multi-level capital market reform,improving the system of Main-Board Market,positively developing Second-board Market and new over-the-counter market,regulate the development of regional equity market at the same time.Meanwhile,Initial Public Offerings and the delisting mechanisms keep promoting,listed companies face greater challenges and opportunities.The financial flexibility reflects the abilities of listed companies raising and scheduling funds,reversing market environment changing coping.To maintain appropriate financial flexibility and build the formation of capital chain management and effective protection mechanism is the necessary condition for companies adapting to the capital market environment changes.And in the process of development of listed companies,the investment activities is an important part in the activities of the enterprises.Nowadays,the investment environment is more complicated,the investment decision-making should combine with their own capital structure and measure the risk brought about by environment changes.Therefore,in the new period,it's a great significance to study the effects of financial flexibility on investment decision-making and efficiency of investment.This article is base the construction of financial flexibility index system of Listed Companies in China.First of all,through the reference of domestic and foreign scholars of literature and theoretical analysis,in this paper,we define financial flexibility as companies with low cost obtain cash flows so as to grasp the investment opportunities.Secondly,build the financial flexibility index covering basic cash holdings,potential cash inflows,the index of enterprise financing capability index and enterprise financing cost index of three major aspects to analyse enterprise financial flexibility.Finally,with2012-2016 years of manufacturing listed companies in China as samples,according to the different control situations of companies,the samples are divided into state-owned and non state-owned two groups.We study the influence of financial flexibility index for different control situations of companies to the scale of investments;on the basis of the state-owned and non state-owned samples,through the classification of enterpriseinvestment efficiency,the samples are divided into two groups of under investment and over investment.the impact of financial flexibility index for different control situations of companies to the investment efficiency is investigated.Through theoretical analysis and empirical researches,we mainly draw the following three conclusions: first,through the construction of index systems,we find that financial flexibility level of Chinese manufacturing industry listed companies is generally low,but steadily,companies pay more attention to the capabilities of rapid changing market's response and grasping investment opportunities.Second,financial flexibility level of Chinese manufacturing industry investment decision of the listed companies and listed companies with a lag phase is a significant positive correlation,there are differences in different control enterprises.Enterprises to make investment decisions this year are negatively related to investment decisions last year;the levels of financial flexibility and corporate investment decisions last year have significantly positive correlation.In the state-owned listed companies,the effect of financial flexibility on the investment decision-making is more salient,the level of financial flexibility in state-owned listed companies last year is more powerful to scale of investment this year.Third,the efficiency of investment in manufacturing industry of our country,state-owned listed companies show excessive investment,and non state-owned listed companies perform lack of investment.Financial flexibility of Chinese manufacturing industry listed companies shows a significant negative correlation with the investment efficiency,it can effectively inhibit excessive investment,alleviate the lack of investment,and alleviating ability to lack of investment is more powerful.There are differences in different control enterprises.In the state-owned listed companies,the efficiency of investment is more susceptible by financial flexibility index lag effect.While in non state-owned listed companies,investment efficiency is more vulnerable to the current financial flexibility index.The impact of corporate financial flexibility of non-state-owned enterprises inefficient investment shows A higher degree of inhibition.