Research On The Motives And Economic Consequences Of Listed Companies' Choice Of Zero Leverage Policy

Zero leverage policy refers to the accounting policy that the total amount of short-term and long-term borrowings of the enterprise liabilities is zero.The theory of optimal capital structure advocates that companies use debt financing,because debt financing has a certain degree of tax saving effect.However,many companies are extremely conservative in debt financing and adopt the zero leverage policy that this study focuses on.Based on this,this study selects a representative zero leverage listed company,Shangpin homestead,to study the motivation and economic consequences of adopting zero leverage policy on the basis of agency cost theory,signal transmission theory and priority financing theory.In terms of motivation,first,the adoption of the business model of settling down at home first and then buying goods has led to the financial characteristics of light assets and high selling expenses,and the lack of high-quality collateral and fluctuating income have constrained the enterprise's financing;second,the internal financing is sufficient,and Shangpin home furnishing can meet the enterprise's financing needs through internal financing,support the needs of daily operation,and select a zero bar for it Rod policy creates financial conditions;third,the risk preference of the management,which has the defensive motivation to avoid debt financing,makes Shangpin home furnishing choose not to raise funds through debt.In terms of economic consequences,zero leverage policy will lead enterprises to adopt a prudent expansion business model and extremely conservative financial strategy.But in the long run,with the increasingly fierce competition in the home furnishing industry,the zero leverage policy will lead to the lack of business investment in Shangpin home furnishing,making the company present a capital gap,which is likely to be unsustainable.Based on the analysis of the causes and economic consequences of choosing zero leverage policy for Shangpin homestead,this study finds that maintaining financial flexibility,financing constraints and management preferences are the key factors for enterprises to actively choose zero leverage policy,which should reduce financing costs and ease the financing constraints on light asset enterprises;secondly,zero leverage companies should pay more attention to the improvement of corporate governance structure by optimizing equity Structure to alleviate the conflict between shareholders,so as to ensure that enterprises can fully enjoy the positive effect of zero leverage strategy.Finally,the capital structure is very important for the development of enterprises.Enterprises should balance the risk aversion and reasonable liabilities,and choose the capital structure which is in line with their own financial characteristics.