Family Management,Family Control And Stock Market Crash Risk

In recent years,the capital market has been turbulent,and stock prices have often plummeted.The rapid evaporation of stock market value has greatly harmed the intere'sts of shareholders,affected the corporate image,shaken investor confidence,and is not conducive to the healthy and stable development of the capital market.The family has a natural preference for control and management.The ultimate controlling shareholder of the family allocates control at the shareholders' meeting and the board of directors of listed family companies,and obtains excess through pyramid structure,cross-shareholding,differentiated shares,and participation in management.Control.So what effect does excess control overlaid on nominal control reflect?Has excess control increased or weakened the risk of a stock market crash?This study uses family business as a sample to study the correlation between family supermanagement,family control and the risk of stock price plummeting.This paper conducts an empirical test on a total of 2,947 observations of family companies listed on the A-share main board from 2002 to 2016,and finds the following conclusions:First,the family participation management has a negative correlation with the risk of stock price crash.(1)The participation of family members in the management has a negative correlation with the risk of stock price crash.Family members are the most direct beneficiaries of enterprise development.Their participation in the operation of the enterprise will be more conducive to maximizing corporate wealth,have the most direct motivation for the enterprise to prosper,and will effectively alleviate the agency problem.(2)The participation of family members in the board of directors has a negative correlation with the risk of stock price crash.Corporate governance is the core of modern corporate systems,and the board of directors is the key to corporate governance.The existence of family members in such a key organization maximizes the normal operation of the enterprise.When a company has negative information,it will be dealt with in a timely manner,rather than set aside Will maximally prevent the accumulation and outbreak of negative news.Effectively reduce the risk of stock market crashesSecond,there is a negative correlation between family control and the risk of a stock market crash.(1)Excessive control at the board level of a family business has a significantly negative correlation with the risk of a stock price crash.The family-level excess control at the board level itself,as an internal governance mechanism,generally reflects the synergy of benefits,enhances the consistency of the company's strategic decision-making and execution,and helps alleviate agency problems and increase information transparency,thereby mitigating the risk of stock price crashes.(2)There is a significant negative correlation between total family excess control and the risk of stock price crash.This shows that the synergy effect of the excess control right at the family board level is greater than the hollowing out effect of the excess control right at the family shareholder meeting.The total excess control power of the family generally shows a supporting effect.The family will work diligently for the healthy development of the family business Increase corporate value,thereby reducing the risk of stock price crash.The innovation of this article is that this article divides the family business into family management and family control.Among them,the excess control is decomposed into multiple levels of excess control at the board level and total excess control(board level+shareholder meeting level),and the relationship between excess control and the risk of stock price crash is hierarchically explored using agency theory and information asymmetry theory.The empirical test of the relationship between the two.This study to a certain extent fills the gaps in the research on the relationship between family businesses and the risk of stock market crashes.The results of the study have certain theoretical significance for the rational allocation of control structure and management power structure of family businesses to reduce the risk of stock market crashes.