Research On Influence Of Actual Controller On Financial Risk-empirical Evidence Based On Companies Listed In Chinese A Share

As early as 1932,Berle and Means pointed out that,the ownership and control power of large scale state-owned enterprises in US are separated;that is to say,the control power of large scale enterprises belongs to management.Until the end of 1990 s,by dating back to all layers of power relationship chain,La Porta et al concluded that,the concentration of ownership and control power is the theory of global enterprise leading morphology,which shook the mainstream ideology of “strengthening manager while weakening shareholder” lasting for nearly half a century.After La Porta proposed the idea of working control,when analyzing the issue of ownership structure,subsequent scholars found the authentic controller of listed company via shareholding control chain—actual controller rather than simply take the first majority shareholder as controlling shareholder to research the expropriation degree.Furthermore,it is determined that,the focus of enterprise governance research turns from corporate manager to the actual controller controlling big stakes of listed company and possessing absolute control power.The equity is centralized in most countries all over the world,so usually one or several strong shareholders exist at the same time,but these shareholders are controlled by ultimate actual controller through pyramid or cross-shareholding,which causes serious separation between residual claim and residual control right,makes the shareholders with less ownership possess more,and finally generates great separation between ownership and control power of actual controller.Meanwhile,Chinese justice is not independent completely and the legal system protecting minority shareholders is unsound.These situation increase the instability of financial condition in listed company and belong to the partial factors leading to enterprise financial risk.According to these situations,in order to deeply research whether there is casual association between actual controller and occurrence of financial risk,this paper looks back to the actual controller and implements empirical research.Taking the panel data of A share companies listed in Shanghai and Shenzhen during 2009-2015,by means of combining theoretical and empirical analysis,this paper researches the influence of actual controller on enterprise financial risk.The following conclusions are achieved:Actual controller is in negative correlation with financial risk,and ownership is in positive correlation with financial risk;in addition,the separation of actual controller's control power and cash flow power provides convenience for controller to “hollow out” listed company and obtain personal gain,which aggravates enterprises financial risk.The separation degree of two rights is in positive correlation with financial risk the influence of actual controller in state-owned nature on enterprise financial risk is more obvious than that of non-sate nature.Based on above conclusions,the following suggestions are proposed: Improve the comprehensive quality of actual controllers and industry risk identification ability;To strengthen the supervision and information disclosure of actual controllers as well as the constraints of laws and regulations;Try to narrow the control number hierarchy and control chain;Improve the ownership structure of listed companies,decrease the ownership concentration.