A Study On The Motivation And Effect Of The Dual-Class Share Structure In Internet Companies

With the rapid transformation of China's economy and the rapid development of Internet technology enterprises,a large number of Internet companies have gone overseas to list recently,the Hong Kong Stock Exchange and Kechuang Board began to accept the Dual-Class Share Structure in 2018.It has triggered the attention and discussion in various sectors of the society.Since its appearance,the Dual-Class Share Structure has been mainly adopted by the family industry and the news media industry.However,with the rapid growth of Internet companies,more and more Internet companies have adopted the dual shareholding structure,and Internet companies have gradually become the main body of the companies that adopt the Dual-Class Share Structure.Why do Internet companies adopt the Dual-Class Share Structure,how the shareholding structure exerts the effect of corporate governance,and what effect and risk the Dual-Class Share Structure brings about.This series of questions is worth exploring.After reviewing the literature review on the rationality of the Dual-Class Share Structure,the motivation of choosing the Dual-Class Share Structure and the advantages and disadvantages of the Dual-Class Share Structure,starting from the"personality" characteristics of Internet companies,combining financing characteristics,human capital and shareholder heterogeneity,this paper analyzes the applicability of the Dual-Class Share Structure in Internet enterprises in detail,and analyzes the feasibility of the equity structure in Internet enterprises through the role of the Dual-Class Share Structure in generating corporate governance effects.In the case part,Jingdong is selected as a typical example of Internet enterprises.Researching the background of Jingdong's listing,the specific content of Jingdong's Dual-Class Share Structure,and the factors that Jingdong can successfully implement the Dual-Class Share Structure in detail,the motivation of Jingdong's choice of the Dual-Class Share Structure and the effect that brought to Jingdong is further analyzed.Finally,it points out the potential risks that brought by the Dual-Class Share Structure to Internet companies,and proposes countermeasures and suggestions for improving relevant systems in China.