Controlling Shareholder Pledge,Equity Characteristics And Company Performance

With the continuous growth and growth of the domestic capital trading market,the scope of application of bill credits has gradually expanded,and the way of raising funds has continued to move toward diversification.The possibility that equity with great advantages in terms of convenience and property has become a pledge is further increased.Equity pledge is a product of China’s economic and capital market development.As an emerging financing method,it helps companies to revitalize their internal wealth stocks and transform them into currency forms to enter the circulation market.This not only injects new into social reproduction.The flow of funds also effectively links the capital market to the money market.Wi th the establishment of the stock pledged repo platform on the exchange in 2013,the scale of equity pledge has exploded,especially the controlling pledge of controlling shareholders of listed companies in China is very common,and the phenomenon of high proportion pledge and whole stock pledge is relatively high.Commonly,in this case,if the stock price falls,the probability of forced liquidation risk increases,which in turn leads to further fluctuations in the stock price of the capital market,which ultimately harms the interests of small and medium investors.In recent years,the issue of equity pledge has become increasingly prominent,and it is not uncommon for controlling shareholders to fall into debt disputes,which has a huge impact on their companies.In this context,it is of great theoretical and practical significance to study the equity pledge of controlling shareholders.This paper sorts out the related literatures on controlling shareholder pledge,shareholding characteristics and company performance.Based on the analysis of principal-agent theory,private interest theory,information asymmetry theory,signal transmission theory and theory of priority financing,the controlling shareholder is studied.The impact of equity pledge on compa ny performance,and consider the adjustment effect of equity characteristics(equity nature,equity concentration,equity balance)on the relationship between the two.This paper selects the data of the controlling shareholder pledge of China’s Shanghai an d Shenzhen A-share listed companies in 2013-2017 as a research sample,and conducts empirical analysis.The results show that the controlling shareholder’s equity pledge has a negative impact on the company’s performance;Role: Compared with non-state-owned controlling shareholders,the negative correlation between the equity pledge of state-controlled shareholders and the company’s performance is more significant;the higher the concentration of ownership,the more significant the negative correlation betw een the controlling shareholder’s equity pledge and the company’s performance;the lower the equity balance,The negative correlation between the controlling shareholder’s equity pledge and the company’s performance is more significant.The research result s can not only supplement the deficiencies of the existing literature,but also guide the vulnerable small and medium-sized investors at the practical level to further protect their own interests from the controlling shareholders of the powerful forces.Finally,based on the results of empirical regression,the author analyzes the reasons,improves the supervision system of controlling shareholders’ equity pledge,optimizes the shareholding structure of listed companies,and broadens the financing channels of listed companies to improve the company’s performance.