A Study On The Risk And Economic Consequences Of Stockholders' Pledge Of Controlling Shares

Ownership structure is an important part of corporate governance research.Controlling shareholders exist extensively among listed companies.Under this ownership structure,the core issues of corporate governance have been transformed from the past agent-management agent conflict to the controlling shareholder-agent conflict between small and medium shareholders.Controlling shareholders can use control to obtain private benefits from the company,resulting in infringement of the interests of small and medium shareholders,which is more prominent in the legal environment of inadequate protection of investors.The equity pledge of major shareholders of listed companies in China is very common.Most equity pledges are relatively normal,and they can all be pledged,covered,repurchased and dismissed.However,due to China's capital market and the related legal system of equity pledge is not perfect,there are still some risks in equity pledge.Cases such as Feng Shengyang,Tongzhou Electronics and Gudi Science and Technology show that the equity pledge will result in some adverse economic consequences to a certain extent,affecting listed companies and stakeholders.The pledge of equity indicates on the one hand that the controlling shareholder has a strong motivation for capital demand;on the other hand,the equity pledge as a controlling shareholder shifts the risk of the fluctuation of equity value to some extent.Therefore,it is of great theoretical value and practical significance to study the kind of economic consequences of equity pledge risk and the control shareholder's own behavior in response to risks.These problems have not caused extensive research.This article takes the equity pledge behavior of the controlling shareholder as the research object.First,it collates relevant theories and analyzes the institutional background and status quo of China's equity pledge,providing theoretical basis and background basis for the follow-up case part;secondly,combining the case study on equity pledge risk and the response process The behavior of the controlling shareholders of the company is to explore the possible ways in which the controlling shareholders' equity pledges affect the value of the listed company,aiming to provide preliminary evidence of the economic consequences of the equity pledge.It is found that the controlling shareholders in this case usually take measures to remedy the risk of a stock-cold collapse,but they only adopt expedient measures such as suspension of trading or release of good news.Because of its strong tendency of equity reduction,the potential financial pressure caused by the equity pledge risk did not enable the controlling shareholder to adopt an active strategy to manage and govern the listed company,but chose to infringe the interests of the listed company and stakeholders.Finally,for the problems found,relevant suggestions and suggestions are proposed.