The Impact Of Holding Shareholder Pledge On Company Performance

At present,China's economy is in a critical period of transformation and upgrading.Most enterprises have entered a stage of diversified development,and the expansion of scale has also urged the increase in financing needs of enterprises.At the same time,the downward pressure on the economy has led to a gradual tightening of the financing environment,and the financing channels of enterprises have gradually decreased.In recent years,the number of negative events in default has increased significantly,mainly due to limited corporate financing and poor debt rolling.Along with the gradual maturity and improvement of China's securities market system,equity pledges with low financing costs,fast time and good flexibility appear in the public's view.It can convert static equity into liquidity,which can alleviate enterprises or The problem of lack of personal funds has become a new and ideal financing channel for Chinese enterprises,especially small and medium-sized enterprises.As we all know,corporate financing is generally difficult.In order to obtain sufficient cash flow,the phenomenon of controlling shareholders' equity pledge is becoming more and more common.At the same time,as the proportion of pledge of controlling shareholders continues to rise,the risk of transfer of control rights has gradually emerged.Since the controlling shareholder has control over the listed company,once the abnormal transfer of control rights occurs,it will have a negative impact on the continuity and stability of the company's operations and damage the interests of other investors.Therefore,it is of great theoretical and practical significance to study how to mitigate the risks brought by equity pledge.There are relatively few studies on equity pledge in the academic circles.Most scholars study the impact of equity pledge on the company's performance,both from the perspective of the pledge of equity pledge exacerbate separation of ownership and control and the increase of controlling shareholders' tunneling motivation.From the perspective of control transfer risk and agency problem,this paper takes the listed company with the controlling shareholder's equity pledge as the research object,and combines the corporate governance mechanism to discuss the impact of the controlling shareholder's equity pledge on the performance of the listed company.On this basis,in order to enrich and improve the theoretical research on the relationship between corporate governance and the shareholding pledge of controlling shareholders and corporate performance,this paper especially introduces external governance mechanisms—institutional investors and government intervention.Based on the above considerations,this paper selects the Shanghai and Shenzhen A-share listed companies whose shareholding pledge occurs in 2014-2016 as a research sample,discusses the relationship between the controlling shareholder's equity pledge and the company's performance,and from the nature of equity,equity concentration,institutional investment And the government intervention in five aspects,to study the impact of corporate governance on the relationship between controlling shareholders' equity pledge and company performance.The empirical results show that:(1)The shareholding pledge ratio of the controlling shareholder has a significant negative correlation with the company's performance;(2)Compared with state-owned holding companies,the negative impact of the shareholding pledge ratio of the controlling shareholder on the company's performance is more significant in non-stateowned enterprises;(3)The negative impact of the shareholding pledge of the controlling shareholder on the company's performance is not obvious when the equity concentration is low;(4)Institutional investors' shareholdings have no negative adjustment effect on the relationship between the controlling shareholder's equity pledge ratio and the company's performance,which is contrary to Hypothesis 3.The reasons may be: First,the institutional investors in China's listed companies have a low shareholding ratio,and the checks and balances on the company's management are limited;second,the long-term stable institutional investors in the domestic securities market are relatively lacking,and short-term,trading institutional investors Mainly focused on information collection and short-term trading profits,not paying attention to the company's governance;(5)The degree of government intervention can restrain the influence of the shareholding pledge of the controlling shareholder on the company's performance..Finally,based on the empirical results of the analysis,it puts forward relevant suggestions from the aspects of improving the equity pledge financing scheme,the government guiding private enterprise financing and cultivating long-term stable institutional investors,and has certain reference and practical significance for the management and control of the holding company's holding shareholder pledge.