The Impact Of Large Shareholder Equity Pledge On Firm Performance

The operation of enterprises is inseparable from funds,but the difficulty of financing has always been a severe test for enterprises.In this situation,equity pledge financing has attracted people's attention with its flexible and convenient features.In recent years,the scale of China's equity pledge has continued to rise.As of 2018,99.52% of the companies in the A-share market have pledge their shares.As a tool to ease financing constraints,equity pledge has indeed promoted the development of listed companies,but the “crash” risk of the stock market has also sounded the alarm for the capital market.Therefore,equity pledge financing also has risks,not omnipotent.As a shareholder who can influence the control of the enterprise,the large shareholder has its own special attributes,and its decision-making usually has impact on the enterprise.Therefore,the economic consequences brought by the shareholder pledge of the large shareholder deserve further analysis.The pledge of the shareholder can obtain sufficient funds to promote the development of the enterprise.However,the excessive proportion of the pledge of the large shareholder will be regarded as a signal of poor development of the enterprise and increase the fear of investors.Similarly,the pledge of large shareholder is theoretically considered a private act,and the large shareholder may bring a private sentiment when making decisions,thus making private interests above the corporate interests.Firm performance is an indicator that can measure the development of a company.Therefore,the impact of the shareholding pledge of the large shareholder on the performance of the enterprise will affect the decision-making of the equity pledge.Will this effect be different? Therefore,this paper takes equity concentration and property rights into consideration,hoping to bring certain practical significance to the research of this paper.Based on previous studies,this paper refers to a series of theories,taking the data of all A-share listed companies from 2014 to 2017 as a sample,using STATA15.0 software and SPSS24.0 software for basic data analysis to examining the large shareholder.The relationship between equity pledge and corporate performance,and the addition of adjustment can enrich the experiment,hoping to enrich the relevant research on equity pledge.The conclusion of this paper is as follows: the higher the shareholding ratio of the large shareholder,the lower the performance level of the enterprise;as the shareholding ratio of the large shareholder increases,the higher the shareholding ratio of the large shareholder,the lower the performance level of the enterprise;compared with the state-owned enterprise,The adjustment of equity concentration in non-state-owned enterprises to the shareholder pledge of large shareholders and corporate performance is more significant.Finally,based on the above analysis,relevant recommendations are proposed from the company level,government level and social level,and the future is expected.It is hoped that the pledge behavior of large shareholder will be further regulated,and then the performance of enterprises will be guaranteed.