Abstract
The Chinese Security Regulatory Commission announced the notice about the experiments of Share Structure Reform in listed company on April 30, 2005, which started the Reform formally. It opens the governor resolving Chinese capital market problem from system lever. However, will it be bound to be able to improve the quality of listed company and perfect the corporate governance as long as having carried out “entire circulation of stock “and "cutting of state-owned shares “? The answer is to deny. The successful experience in developed country indicates stock concentration and the legal protection to investor benefit are two elements in an effective governing. It is very complicated between equity structure and corporate performance, which needs further investigated.
The equity structure shows intense route dependence in our listed companies stock. The state-hold share being alone big and peculiar equity structure such as structure being placed separately resulted from the capital market history are considered as the important cause why the listed companies’ governance lack for efficiency and why the achievement shows not so nice.
Whether equity structure of the listed companies in China have correlation on corporate performance and how? Studying these problems could help us discover the defects in our corporate governance and give the suggestion on how to promote the performance and perfect the equity structure. The paper discusses the correlation of equity structure on corporate performance so as to study the effect of corporate governance.
Based on the review of related literature, the mechanism of stock structure on corporate performance has been studied further. Totally 2001-2005 listed companies were chosen as samples. The empirical study of equity structure and corporate performance was carried out through combining the descriptive analysis, principal component analysis, and using cross-sectional mode based on financial data and SPSS. Then after creating synthetical corporate performance model H on four aspects of performance, several models of the relationship between equity structure and corporate performance were creatively established. Based on all the above, the paper discusses the correlation between the stock composition and stock concentration and the corporate performance separately.
The empirical study demonstrates that the impact of stock composition and stock concentration over synthetical corporate performance is unable completely identical. Final, based on the above theoretical analysis and empirical results and characteristics of the environment of corporate governance, the paper has put forward some political suggestion to the improvement our stock market.
Key words：Equity structure Stock composition Stock concentration
Synthetical corporate performance Principal component analysis
