Research On Equity Incentive,Bank Loan And Enterprise Risk-taking

Enterprise risk-taking decision-making refers to the choice of expected return level and volatility degree in the process of business investment.As a profit-making organization,enterprises must take corresponding risks while pursuing high returns.As a self-financing legal person organization,enterprises must also prevent excessive risk-taking,avoid being listed as "zombie enterprises" and avoid facing bankruptcy crisis.Therefore,in the process of business decision-making,enterprises should learn how to avoid risks while pursuing interests,so as to make the level of risk-taking appropriate.According to agency theory,equity incentive is considered as an effective means to solve the principal-agent problem.Implementing equity incentive can not only attract high-quality talents,but also effectively solve the principal-agent problem.However,excessive equity incentives will cause executives to seek private interests and harm the interests of enterprises,thus excessively improving the level of enterprise risk-taking,resulting in adverse economic consequences.Therefore,enterprises must pay attention to equity incentive and its degree in order to develop well in today’s fierce market competition environment.Bank loan is the main way of enterprise debt financing.In China,banks are the main financial media.At present,there are two opinions on the supervisory role of bank loans in academic circles: one is that because there is no perfect bankruptcy and withdrawal mechanism,creditors lack the restraint mechanism for debtors,debts can not give full play to their supervisory and Governance role.Another view is that corporate governance of bank claims has begun to play a role,and has increased the constraints on debtors.Therefore,whether bank loans can effectively play their supervisory and governance role is still a topic worth exploring.So far,there is no unified conclusion about the relationship between equity incentive and enterprise risk-taking in Chinese academic circles.The literature on the impact of equity incentives on corporate risk-taking can be roughly divided into trench effect hypothesis and interest convergence hypothesis.Therefore,the relationship between equity incentive and risk-taking deserves further study.However,the relationship between equity incentive and bank loans,and the relationship between bank loans and risk-taking are seldom discussed by scholars at home and abroad.Therefore,this paper will explore the relationship among equity incentives,bank loans and enterprise risk-taking.Based on the above background,this paper mainly studies: What impact does equity incentive have on risk-taking of listed companies? What is the impact of bank loans on risk-taking of listed companies? Does equity incentive affect bank loans? Do bank loans play an intermediary role? Does equity incentive and bank loans interact with risk-taking of listed companies?For this reason,this paper first introduces the principal-agent theory,information asymmetry theory,signal theory and risk-taking theory to lay a theoretical foundation for empirical research in this paper.Then,based on the review and theoretical analysis of the existing literature,the research hypothesis on equity incentives,bank loans and enterprise risk-taking is put forward.The sample of listed companies listed on Shanghai and Shenzhen Stock Exchanges and issued A-shares from 2013 to 2017 is selected to study the impact of equity incentives and bank loans on enterprise risk-taking under the whole sample.For further study,the sample is based on the analysis of the data.Controller nature,financial development level and ownership concentration were tested in groups,and the two groups were regressed.The conclusions are as follows:(1)Increase of equity incentives and bank loans will significantly improve the level of enterprise risk-taking.Among the three relationships,bank loans play a regulatory role.Under the regulation of bank loans,the positive role of equity incentives in enterprise risk-taking is strengthened.(2)The positive correlation between non-state-owned enterprises’ equity incentive and enterprise risk-taking is significantly stronger than that of state-owned enterprises,while the relationship between bank loans and enterprise risk-taking is also significantly positive correlation between non-state-owned enterprises and state-owned enterprises.(3)The relationship between equity incentive and risk-taking of enterprises with high marketization level is weaker than that of enterprises with low marketization level,while the relationship between bank loans and risk-taking of enterprises with high marketization level is stronger than that of enterprises with low marketization level.(4)The relationship between equity incentive and risk-taking of equity-centralized enterprises is stronger than that of equity-decentralized enterprises,while the relationship between bank loans and risk-taking of equity-centralized enterprises is weaker than that of equity-decentralized enterprises.The contribution of this paper is to examine the impact of social level(bank loans)on risk-taking of listed companies.It verifies the influence mechanism of bank loans on enterprise risk-taking level under the background of Chinese system in the past,enriches the research literature on enterprise risk-taking,and demonstrates how the holding of bank loans affects enterprise risk-taking.In addition,the joint introduction of equity incentives and bank loans provides a new way to study the level of enterprise risk-taking.The sample companies with different property rights,different levels of development and different degree of ownership concentration are carefully classified,and the impact of equity incentives and bank loans on enterprise risk-taking under different specific circumstances is investigated in depth,so as to further clarify the relationship between the three.