Empirical Research On The Impact Of Controlling Shareholders' Equity Pledge On Enterprise Risk-taking

In recent years,equity pledge has been particularly rapid as an emerging financing method.According to the data disclosed by China Securities Depository and Clearing Corporation Limited,the proportion of companies that pledge their equity in A-share companies is as high as 99.8%,which indicates that equity pledge has become an important way for controlling shareholders and listed companies to raise funds.But the risks behind the equity pledge business should be given high attention.Domestic stock prices have been falling all the time since 2018,which has led to frequent risk warnings that stock prices hit the closing line.Announcements on the disposal of pledged equity and passive reductions by financing institutions are common.Therefore,the market is beginning to worry that stock pledges will cause the stock price to fall continuously,which will trigger a series of vicious chain reactions.Against this background,this article studies the relationship between the controlling shareholder's equity pledge and the risk level of the listed company,which is of practical significance to manage the risk-taking level of listed companies and avoid the negative effects of excessive risks on the company itself and the capital market.This paper uses a combination of normative analysis and empirical analysis.This article first sorts out the domestic and foreign literature and summarizes the related theories such as principal-agent theory,signal transmission theory,contract theory,and transaction cost theory as the theoretical basis.Based on this,we analyze the theoretical relationship between the controlling shareholder's equity pledge and the risk exposure of listed companies,and propose corresponding research assumptions;Then this article uses all A-share non-financial listed companies from2013 to 2018 as a research sample to empirically explore the effect of controlling shareholder equity pledge on the level of risk exposure of listed companies.Based on the perspectives of listed companies and controlling shareholders,this paper further explores the effects of the relationship between the controlling shareholder's equity pledge and the risk exposure of listed companies.Finally,this paper uses 2SLS method to solve the endogenous problem and ensure the robustness of the results.The study found that the controlling shareholder's equity pledge has a significantly negative correlation with the risk level of the listed company.From the perspective of the listed company,the non-state-controlled listed company and the controlling shareholder's equity pledge of the listed company under a high level of check and balance willsignificantly reduce the company's risk-taking level.From the perspective of the controlling shareholder,when the controlling shareholder's equity is subject to continuous pledges and long-term pledges,it will significantly reduce the company's risk-taking level.Based on this,this article proposes targeted policy recommendations to provide new policy recommendations for regulating the equity pledge behavior of shareholders of listed companies.