Research On The Influence Of Equity Balance On Inefficient Investment Of Public Utility Listed Companies

On September 13,2015,the Central Committee of the Communist Party of China issued a programmatic document �Guiding Opinions on Deepening the Reform of State-owned Enterprises� for the reform of mixed ownership system.Through the implementation of equity diversification and the perfecting of the corporate governance structure,the reform of state-owned enterprises has entered a new period of deepening reform and standardizing governance.As our country's public utility companies gradually embark on the road to listing after completing the reform of enterprise,China's performance in terms of investment efficiency is different from that of other state-owned enterprises.Theoretically,high-quality equity checks and balances will improve investment efficiency to a certain extent,but in fact its governance effect remains to be investigated,and the special equity structure of publicly-listed companies may have a certain impact on the governance of equity checks and balances.In order to explore the deep transmission mechanism of the role of equity checks and balances in inefficient investment,based on the background of mixed ownership reform,and the data of public utility companies in China from 2009 to 2018,the author conducted an empirical analysis the relationship between equity checks and balances and inefficient investments in public utility companies.The results show that improving the degree of equity checks and balances has a significantly positive effect on alleviating the inefficient investment of public utilities.Compared with central state-owned enterprises and non-state-owned enterprises,the impact of local state-owned enterprise equity checks and balances on non-efficient investment is more significant.The degree of checks and balances will reduce double agency costs.At the same time,agency costs are an effective way for equity checks and balances to affect the inefficient investment of public utilities.Specifically,equity agency costs have a fully intermediary effect,and control agency costs have a partial intermediary effect.Conclusions will provide useful enlightenment for public utility companies to configure a reasonable shareholding structure and formulate optimal foreign investment policies.The paper has 3 figures,23 tables and 86 references.