Research On Issue Of Multi-Voting Stock In Chinese Companies

Multi-voting stock has a history of 100 years in the United States.Despite unceasing controversy amid its development,multi-voting stock gained continuous growth in the past 100 years,because it helps avoid dilution of equity after a start-up introduces external funds,ensuring that the corporate is still under the control of its founders.The Hong Kong Exchanges and Clearing Limited(HKEx)has allowed the IPO of companies with multi-voting stock starting from this year,though the Shanghai Stock Exchange and Shenzhen Stock Exchange have not followed suit.However,as China society has witnessed an unprecedented level of innovation and entrepreneurship,it is suggested that our legislative bodies actively develop and promulgate management measures for the issuance of multi-voting stock as soon as possible,so that the start-ups in fast-developing Internet industry and innovative economic companies may have more choices,and better leverage their advantages in human capital to promote innovation.This paper introduces the concept of multi-voting stock and its development history.It employs the human capital model to analyze from the perspective of Schultz's human capital,and concludes that professional and high-quality human capital can be a key force to drive the rapid development of a company,making it to stand out from fierce competition.In some innovative companies,the founder or the management team is the backbone of the company.Their unique dreams and vision,that is,the founder's unique human capital is their key success factor.Issuing multi-voting stock and implementing dual ownership structure in such companies can ensure that the founders have solid control over the company as well the direction of the company's development.It also gives full play to the founder's human capital advantage and its entrepreneurship to promote innovation and new economic development.Finally,this paper analyzes the possibility of issuing multi-voting stock in Chinese companies,and explores how to develop the system in China.