Analysis Of The Interests Encroachment Of Changfa's Controlling Shareholders And Its Impact

In the field of traditional corporate governance,the focus of research is on the agency problem between the management and listed shareholders of listed companies.However,with the continuous research of scholars from various countries,the issue of corporate governance has gradually evolved from the first type of agency problem to the second category.The second type of agency problem is the conflict of interest between the controlling shareholder and the minority shareholders.In order to curb the large shareholders' interest in the minority shareholders,China has carried out the share-trading reform,and has successively issued a series of regulatory measures,in the hope of curbing the interests of large shareholders and protecting the interests of minority shareholders.However,in the era of full circulation,the behavior of encroachment of major shareholders is still common,and the phenomenon of controlling by major shareholders is still widespread.Compared with state-owned enterprises,the controlling shareholder of a private enterprise is more likely to implement the act of encroachment of interest in the absence of a legal environment in China.In addition,due to the relatively concentrated equity of private listed companies in China,controlling shareholders are generally found in listed companies,and the pyramid ownership structure is the most common.The separation of the controlling shareholder's control rights and cash flow rights caused by the pyramid's shareholding structure makes it easier for the controlling shareholder to encroach on the interests.Sometimes it will be embodied by a controlling shareholder gaining huge profits by selling control of a listed company.In this context,this paper uses the case study method to select the Changfa shares of the listed company with the pyramid shareholding structure as the research object,and analyzes the interest encroachment of the controlling shareholder in the sale of the shell.The contents of the analysis include the motive of interest encroachment,the behavior of interest encroachment and the consequences analysis of interest encroachment.It is concluded that the controlling shareholder's behavior of encroaching on the listed company through the pyramid shareholding structure will have an adverse impact on the company's operation,resulting in the company's share price falling,and the interests of the minority shareholders are also implicated and lost.This behavior is not conducive to the development of China's economy and the stability of the capital market.Finally,in order to standardize the behavior of controlling shareholders to sell control,protect the interests of small and medium shareholders,and promote the healthy development of the entire capital market,the enlightenment of this paper is as follows: some improvements are needed in the internal governance of listed companies,the information disclosure system for major shareholders to reduce their holdings,the punishment and external supervision,and the self-prevention of small and medium shareholders.