A Statistical Study On Institutional Investors' Supervision Of Financial Failure Of Listed Companies

China's institutional investors in 90s,although a late start,the rapid development of international institutional investors also have been rapid development.The impact of institutional investors on the stock market is growing,institutional investors are not only the backbone of the development of the securities market,but also the effective supervision of listed companies.Recording to the China's "company Iaw",major related transactions on the company,foreign institutional investors to provide guarantees and other important matters of access,proposals and voting rights,can be directly involved in the internal supervision of listed companies.This paper aims to analyze financial failure of listed companies at the perspective of institutional investors.According to the study of others,this paper analyzes the possibility of institutional investors' financial failure under the premise that institutional investors can take an active part in corporate governance.In the second part,we study the effect of institutional ownership on the prediction of listed companies financial failure,using the sample that losses for two consecutive years of listed companies in China's A shares from January 2003 to May 2016.The results show that institutional ownership is negatively associated with listed companies financial failure.In other words,the higher the proportion of institutional ownership,the smaller the possibility of the company's financial failure.In addition,we also found that the institutional ownership can further improve the prediction ability of model.The research findings has some direct effect on the risk management of listed companies.In the third part,the research also using the sample that losses for two consecutive years of listed companies in China's A shares from January 2003 to May 2016,using Probit estimation method,to explore whether the shareholders of institutional investors and listed companies in the same province influence on the company's financial failure.The study found that the same institutional investors significantly reduce the possibility of financial failure.The study affirms the positive role of "local preference",and points out that whether or not the location of the headquarters of the invested company is consistent with the regulatory function of institutional investors.Based on the empirical conclusions,it is very necessary to develop institutional investors and strengthen their ranks,guiding institutional investors to take an active part in the supervision of the company.By improving the company's internal value to avoid delisting crisis.