The Influence Of Ownership Concentration On The Enterprises' Financial Investment Behaviors Under External Governance Environment

In 2000,the financial industry profits exceeded the entity industry and began to grow at a large scale.In 2014,the financial industry profits accounted for more than 50% of the overall industry profits."China Enterprise News" pointed out: Our countries' entity economy is currently entering a state of prostration.In recent years,under the impetus of capital gains,entity enterprises have abandoned its insistence on the main business and invested a large amount of capital into the financial and real estate fields,gradually at "disconnecting from entity",resulting in overcapacity,a downturn in the entity economy,and an imbalance in economic development.In the period of rapid development of high returns of the financial industry and the real estate industry,the funds continuously drawn from the entity enterprises are devoted to the non-main business areas of the financial industry and the real estate industry.The lack of investment in innovation and R&D is insufficient for the sustainable development of the entity enterprises."The report of the 19 th National Congress" emphasized that the construction of the economic system should focus on the development of entity industry such as manufacturing,and the suppression of social capital "disconnecting from entity".Therefore,the financial behaviors that inhibit the entity's allocation of financial assets and investment in real estate have attracted the attention and research of the theoretical and practical circles.Based on theories of principal-agent theory and free cash flow,this paper considers the governance effect of internal shareholding structure,from the stakeholder's right and interest,analyzes the economic consequences of the entry of entity enterprises into the financial and real estate industries.According the major shareholders based on their personal interests can pay more attention to the business performance,this paper gets the main hypothesis of the relationship between equity concentration and financial investment behavior of the entity.Based on the differences in the institutional environment between the eastern and western regions of China,this paper considers the adjustment effects of external environmental factors and the differences effects between regions.On the basis of theoretical analysis,it is proposed that the external governance environment and internal equity supervision can influent non-main business investment behaviors of entities,reflected "substitution effects." Based on the existing domestic and international academic theoretical research results,this paper sorts out the relevant theoretical research,and discusses the influence of the internal and external factors on the financial investment behaviors of the entity enterprises.Based on the hypothesis and model constructions,the listed A-Share companies in China's non-financial and real estate industries from 2010 to 2017 are selected as research samples.After processing the data and multiple regressions,the following conclusions are drawn:Firstly,the concentration of equity is significantly negatively correlated with the entry of entity enterprises into the financial and real estate industries,and this negative correlation is still significant in the model regression of the industry.In addition,state-owned enterprises are more likely to be financialized,and can weaken the inhibitory effects embodied in equity concentration;Secondly,the perfect regional governance environment can play the supervisory role,reflected "substitute effects" with the concentration of ownership on the financial investment behaviors.Thirdly,the regression results of different sample groups,show that the concentration of equity in non-eastern regional enterprises have a stronger inhibitory effect on financial investment behavior than that of eastern regional enterprises.Further,this paper finds that the state-owned property rights of the enterprise can weaken the negative relationship between equity concentration and financial investment behavior.Based on the conclusions of this paper,this paper believes that relatively concentrated equity institutions can encourage shareholders to pay more attention to the business situation of the enterprise.Entity enterprises must actively develop main business and enhance market competitiveness and innovation.The government should improve the market environment and weaken the unnecessary intervention of enterprises.Major shareholders should actively identify the risks of financial investment and constrain management cross-industry arbitrage.This paper has certain reference significance for restraining the "disconnecting from entity" investment behaviors of the entity enterprises,and enriches the research on the relationship between the equity structure and the investment behavior of the entity.