Analysis Of The Governance Path Of Institutional Shareholding On Inefficient Investment Of Listed Companies

Since the reform and opening up,China has implemented a financing system with indirect financing as the main body,but the indirect financing system has raised the overall debt and raised the leverage ratio.Therefore,the Chinese economy must solve the problem of capital structure mismatch and improve the efficiency of capital allocation.The structure has changed from indirect financing to a dominant approach to direct financing.On November 5,2018,President Xi Jinping announced the establishment of the Science and Technology Edition,marking that China will establish an efficient direct financing structure.Equity financing as an important part of the direct financing system,improving the efficiency of resource allocation in the equity financing market is conducive to the expansion of the direct financing scale of China’s capital market.The key to improving the efficiency of resource allocation in the equity financing market is how to solve the problem of indirect investment affecting the mispricing of listed companies.In China’s equity financing market,market participants lack investment experience and the equity research system is immature.Therefore,China’s stock market is prone to stock mispricing.Stock mispricing will affect the company’s investment decisions through various paths,and form non-efficiency investments.Non-efficiency investment refers to the rationalinvestment level of the company’s actual investment level that does not meet the operating environment of the company’s development stage.The emergence of non-efficiency investment will affect the company’s future financial health and damage the company’s development potential,thus solving the problem of stock mispricing.Inefficient investment is a major issue to enhance the effectiveness of China’s direct financing market.China’s financial institutional investors are important participants in the stock market.Institutional investors have strong capital strength and rich experience in capital market operations.They have the ability and willingness to deal with the non-efficiency investment problems of participating companies.Therefore,the academic community has proposed the holding of financial institutions.Relevant governance methods,but in China’s equity market,whether the institutional checks and balances of the institutional shareholder can be verified,and further need to further study the impact of institutional holdings on non-efficiency investment.This paper studies the influence path of institutional shareholding on the inefficient investment behavior of listed companies,and proposes relevant hypotheses through theoretical analysis and verification in empirical analysis.In the theoretical analysis part,based on the previous studies,this paper analyzes the intermediary influence path of stock mispricing on non-efficiency investment and explores whether institutional shareholders can manage non-efficiency investment behavior through these paths;in the empirical analysis part,this paper uses Richardson.The model obtains the level of non-efficiency investment,and measures the stock mispricing level by decomposing Tobin Q.The median effect test analysis is used to verify the impact path of non-efficiency investment,and the data envelopment analysis(DEA)is used to further analyze the samples.The results show that: First,from the overall sample,stock mispricing from financing path,momentum path,catering to path,management path affects institutional investment,and institutional shareholders from financing path,momentum path,catering to path governance inefficient investment Secondly,there are significant differences in the governance effects and governance paths of different operating efficiency companies and institutional shareholders.In thesample group of low operating efficiency listed companies,the governance effect of institutional shareholders disappears,and listed companies with high operating efficiency In the sample group,the institutional shareholder’s governance effect is significant and focuses on suppressing inefficient investments through momentum paths and financing paths.Finally,based on theoretical analysis and empirical analysis results,combined with China’s policy environment,relevant policy recommendations are put forward.