Heterogeneous Entity Enterprises' Financial Investment And Operating Income

After the financial crisis,the global economy as a whole in the doldrums,and China's economy is also in the down.As a result,the physical enterprise s face a sharp decline in external demand and lack of domestic demand develo pment situation,leading to the entity's profitability suppressed.In recent years,the rapid development of the financial sector,bringing the stock of financial as sets rising,and further with the national policy level of the financial sector ac cess to the gradual reduction of barriers,more and more entities through intern al business activities and financial activities integration and complementarity,pa rt of the funds invested in financial markets.In the development of the main business profitability increased,the financial sector continue to develop financia 1 investment in the soil,as well as the management of short-term performance indicators under the pressure of assessment and other factors.A large part of the listed entities to invest in financial enterprises.According to Wind statistic s,China's listed companies in the number of financial investment in the numbe r of enterprises accounted for more than 90%,and its financial investment in the proportion of total assets accounted for about 14%,showing that financial investment has become an important business listed in the companies business.However,the resources are limited.Listed companies will be invested into the financial field,is bound to the main business investment and development hav e an impact.Therefore,listed entities of the financial investment in the main b usiness profitability of the impact of this paper constitute the research topic.Therefore,this paper chooses the A-share listed companies in Shanghai an d Shenzhen in 2011-2015 as the sample,and explores the impact of the financ ial investment of the entity on the operating income through empirical research.First,it is necessary to study whether the entity's financial investment and the degree of financial investment have an impact on the operating income.Secon dly,it is necessary to study whether the financial investment of the entity ente rprise will have heterogeneous influence on the operating income by grouping t he operating rate of return and investment efficiency.The results of this study show that:(1)the higher the level of financial i nvestment of the entity,the lower the profitability of the business,the lower t he profitability of the core business;(2)the profitability of the company is hig h,financial investment will promote the enterprise operating rate of return;the profitability of the company is general and low,financial investment will reduc e its operating rate of return;over-investment and under-investment entities,its financial investment will weaken its main business profitability;investment eff iciency of the entity financial investment between the firm and its operating in come has no correlation.In order to solve the endogenous problems that may exist between the ind ependent variable financial investment and dependent variable operating income,this paper learn form Faccio et al(2011)to use the average of the financial level of other companies in the same industry as the tool.In order to improve the robustness of the research,this paper makes some adjustments to the mea sure of the degree of financialization,which financial money and long-term eq uity investment in two parts removed from the formula.As a result,the concl usion is consistent with the main regression.Therefore,the conclusion of this paper is more robust and reasonable.Based on the research results and theoretical analysis of this paper,this p aper puts forward some suggestions:rationalize the executive compensation con tract,weigh the short-term performance evaluation index and the long-term perf ormance evaluation index,and give appropriate consideration to the bottom of the insurance and the cap to the salary contract,rationalize the management Ri sk-taking,and ultimately the formation of shareholders and management of the sharing of risk-sharing risk;to strengthen the shareholders of risk awareness a nd social responsibility education,especially with state-owned enterprises;regul ators should strengthen the supervision of listed companies refinancing,Capital supervision;government tax authorities to consider a reasonable reduction of th e burden of corporate tax enterprises,to reduce the real business enterprises to develop the operating pressure to prevent the emergence of enterprises in the hollow.