Study On Concentration Ratio Of Shares,Business Strategy And Financial Performance

As an international research hotspot of business strategy,finance and financial management,the financial performance of listed companies has been favored by many scholars at home and abroad.Based on this background,this paper comprehensively studies the relationship among concentration ratio of shares,business strategy(diversification strategy,professional strategy)and financial performance,so as to provide theoretical and practical support for listed companies to optimize corporate governance structure,transform and upgrade business strategy.This paper innovatively constructs a comprehensive empirical model of "concentration ratio of shares,business strategy and financial performance".Using multiple linear regression model,T test,F test,D-W test and bootstrapping,combined with the data of 1985 A-share companies in Shanghai and Shenzhen Stock Exchanges in recent five years(2014-2018),this paper empirically analyses concentration ratio of shares,business strategy and financial performance.The three aspects of performance interact with each other.Through this study,we find that:(1)Ownership concentration has a significant positive impact on financial performance.The higher the proportion of the largest shareholders,the more beneficial it is to the improvement of corporate financial performance.(2)There is a negative correlation between diversification strategy and financial performance in business strategy,and a positive correlation between professional strategy and financial performance,and statistically significant.That is to say,the implementation of diversification strategy has significant discount effect,and the implementation of professional strategy has significant premium effect.(3)With the increase of concentration ratio of shares,the discount effect of diversification strategy on financial performance and the premium effect of professional strategy on financial performance will be weakened.In the view of the research conclusion,in order to improve the financial performance of listed companies,this paper proposes the following suggestions: one is that,listed companies should maintain a moderate concentration of equity and optimize the governance structure of listed companies.Second is that,given the impact of business strategy on financial performance,listed companies should pay attention to the development of the main industry,and carefully carry out diversification strategy according to the company's actual situation.Three is that,promote the organic integration of corporate governance structure and business strategy,while optimizing corporate governance structure,transform and upgrade business strategy to ensure the continuous improvement of financial performance of listed companies.