CFO Interial Director,Decision Rights Allocation And Investment Efficiency:Empirical Evidence From China's Capital Market

The investment behavior embodies the management strategy of the enterprise manager.In the choice of investment behavior,they are likely to choose non efficient investment behavior to damage the profits of the enterprise and seize the interests for themselves.At the same time,this behavior indirectly damages the rights and interests of the enterprise investors.In addition,there are still great controversies in the research on the allocation of decision-making power.On the one hand,the scholars believe that the right to decision making and the control of decision-making should be separated according to the agency theory,and that the organizational efficiency of the enterprise will be damaged by the agency problems arising from the establishment of the decision-making power and the right of control.It further points out that opportunism is very easy to appear in the management layer represented by the general manager;on the other hand,according to modern stewardship theory,the scholars believe that the managers in the company system are self-discipline,they have the common goal with other stakeholders,and the managers are altruist and he is an altruist.We will seek a certain benefit for the organization and the shareholders of the company,but not just the self-profit economic subject.Therefore,the relationship between the decision-making power allocation and the efficiency of the enterprise investment efficiency also deserves our deep exploration.In the study of enterprise investment efficiency,the researchers at home and abroad,under the agency framework,focus on the influence of the background characteristics of the executives on the investment efficiency of the enterprises.The research finds that the executives tend to seek rent and invest blindly in order to maximize their own interests,and then produce more ineffective investment.Expenditure,damage the value of the enterprise.As a company executive,CFO has more resources after entering the board of directors.Is it like CEO and other executives,to invest blindly in pursuit of personal interests and harm the interests of investors together? In addition,when the separation of decision-making power and decision-making control power is low,there may be problems of adverse selection and moral hazard in management.Is it possible for the internal directors of CFO to serve their financial directors effectively,increase the transparency of information,and ultimately improve the efficiency of the enterprises' investment? Further,the relationship between the non-efficient investment direction and the relationship between the internal directors of CFO,the allocation of decision-making power and the efficiency of investment is more obvious.In addition,whether the external environment differences in the enterprise will also affect the relationship.This study focuses on the above problems,reveals the truth of the problem,and tries to get guidance on practice.This paper,taking the A shares listed companies from 2007 to 2014 as the research sample,uses the methods of literature analysis and summary,logical hypothesis and empirical test,and takes the internal directors and decision-making power of CFO as the breakthrough point to explore the impact on the enterprise investment efficiency,and further divides the inefficiency investment into over two parties with overinvestment and insufficient investment.On the basis of this,we explore the relationship between CFO internal directors,decision-making power allocation and enterprise investment efficiency.And further consider the external factors of the enterprise,select the market process indicators,and analyze whether the development speed will affect the relationship between the CFO internal directors and the enterprise investment efficiency.The results show that CFO,as an internal director of the enterprise,can effectively supervise and constrain the private interests of managers and reduce the agency problems caused by the inefficiency investment of the enterprises,and thus significantly improve the investment efficiency of the enterprises,which are based on their own professional development and economic interests.When the degree of departure is low,the management decision lacks the necessary supervision and control mechanism to aggravate the moral hazard and adverse selection of the manager level.If CFO serves as an internal director in these enterprises,it can effectively play the supervisory function of its financial directors and provide more information for the board of directors to make decisions.Efficient investment behavior improves the investment efficiency of enterprises.Therefore,compared to those with higher separation degree,the internal directors of CFO have a more prominent impact on the efficiency of enterprise investment.In further testing,it is found that CFO is a director in overinvestment enterprises,and its inherent professional prudence makes it more obvious to the improvement of investment efficiency.In the underinvested enterprises,their professional habits may make the decision-makers lose good investment opportunities and serve as the internal director's CFO to investment efficiency.The effect of the improvement is not very obvious.In addition,the research finds that the market process makes the external governance environment of the supervision and constraint management effectively improve and indirectly supervises the abuse of power by the managers.On the contrary,when the market level is low in the region of the company,the private sector through the non-efficient investment to grab private.The behavior of human income will be more serious.At this time,CFO will be more helpful to the function of the company directors and will have a positive impact on the efficiency of investment.The conclusion of this paper shows that when CFO enters the board of directors,to a certain extent,it inhibits the agency problem of the company managers and protects the interests of the external investors.At present,the economy of our country is in the transition period,the operation system of market economy still remains to be perfected.The conclusion of this paper has beneficial reference and evidence support for improving the corporate governance and improving the efficiency of resource allocation.As for the business decision making department,CFO is the research of the influence of the board members on the investment efficiency of the enterprise.The conclusion provides a new way of thinking on how to restrain the power of management and reduce the problem of agency and information asymmetry.In addition,the interaction of decision-making power and market process on the relationship between CFO internal directors and investment efficiency also provides a basis for the decision making of the board of directors,and promotes the market of the government for the government.The construction of the environment provides new arguments.