The Research On The Factors Of Financial Governance Efficiency Of Listed Agricultural Companies

Our agriculture has been in contributional position. So it keeps a steady stream of cheap labor and capital to protect the industrial development and industrialization process. That determines the slow development of our agricultural industry, which is the source of little profit of our agricultural industry. But it is undeniable that the agriculture in promoting economic development in the foundation and first position and the role is irreplaceable. This is the reason of selecting the agriculture, and it is significant value and far-reaching significance for agriculture and listed agricultural companies.Our listed agricultural companies first listed in 1993 has experienced 18 years, although the number of listed companies, asset size, number of shares outstanding were less than 5% share, but the impact of the listed agricultural companies on the securities market and the national economic development can not be ignored. The government issued a thirteenth on agriculture "Document" at January 29,2011, and the government highlights the growing attention for agriculture. After ten years of efforts, the agriculture continue to improve the governance structure of listed companies. Due to various factors and constraints, the country's overall agricultural listed companies there is relatively slow, inefficient management, poor financial performance, weak competitiveness, and serious illegal agricultural restructuring, and etc.These problems caused inefficiency of the financial management.At the same time, there are more and more researchs on corporate governance. The research is expected to address the governance practices of listed companies during the emergence of a number of complex financial problems. Furthermore, there are more study of financial management efficiency, which is determined the real economic policy changes in the objectives and success criteria. And it is the key to deepen the study of corporate financial governance. Therefore, the study of financial governance efficiency factor of listed agricultural companies is of great theoretical value and practical significance. 1.Main point in the thesis(1) Theoretical analysis. The auther use the agricultural economic development theory, institutional change theory, the modern enterprise theory, the asymmetric information theory and the financial theory to analysis the theory of origin. And put forward constructively the four specific objectives. Its ultimate goal is to improve the of financial governance efficiency to enhance corporate value and improve the competitiveness of the company's financial core.(2) Conceptual framework. We analysis the important position of agriculture in the national economy, expounded the development process of the listed agricultural companies and it's financial characteristics. And we discriminated the concept of financial governance related and clearly defined financial governance. At the same time, we analysised the transmission mechanism between the financial governance efficiency and corporate financial performance. They have a positive relationship. The conceptual framework clarified the concepts and pave the way for the later studies.(3) Impact mechanism. We analysed the internal and external factors of the financial governance efficiency of listed agricultural companies and explained deeply the affecting mechanism of the internal and external factors of the financial governance efficiency in order to further lay the theoretical foundation for empirical research.(4) Empirical analysis. We selected variables of affecting financial governance efficiency alternative to internal and external factors, built models, used the dimensions matching method to find the manufacturing paired samples to verify the affecting. We had the different conclusions on manufacturing paired samples to highlight the listed agricultural companies characteristics.(5) Policy recommendations. Based on the building the conceptual framework, mechanism analysis and empirical research, we put forword the macro and micro policy recommendations. And then, we want to improve financial governance efficiency through perfection of the macroeconomic environment and the company level governance structure. Thereby enhancing the competitiveness of its financial core, to promote sustainable and rapid agricultural economic development.2.Basic conclusion in the thesis(1) The ultimate goal of financial governance is that the enterprises allocate effectively the financial power to improve operational efficiency through institutional arrangements related to financial governance. It can protect the interests of stakeholders and promote the enterprise's goal. The financial governance is a governance form between the corporate governance and the financial management. And it is a series of institutional arrangements to allocate effectively the financial power at the shareholders, creditors, board of supervisors and managers. Financial right should include the financial control and the financial residual claims, and financial control can be subdivided into the financial decision-making power, the financial supervision, the financial executive power and the financial income distribution.(2) The financial governance efficiency is positively correlated with the enterprise performance. That is, the higher the financial governance efficiency, the better the enterprise performance. The interior and external factors don't affect directly the enterprise performance. They will affect firstly the financial governance efficiency, and then impact on the enterprise performance and the enterprise value.(3)The listed agricultural companies have the different financial characteristics from other industries. The listed agricultural companies debt ratio is low. The listed agricultural companies are a step change in the financing structure. The listed agricultural companies have the high rates of current liabilities and a single source of debt financing.The proportion of retained earnings is low in equity capital structure. Law violations seriously. Poor operating performance and less competitive. These features resulted in the listed agricultural companies less efficient.(4)Empirical research shows that the financial and tax subsidies is negatively correlated with the financial governance efficiency. The government intervention degree, the rule of law and the marketing process are positively correlated with the financial governance efficiency. Otherwise, the Dimensions matching method used to obtain matching samples-manufacturing companies showed their different characteristics. The financial subsidies and tax subsidies were no help to improve the financial governance efficiency. It had a significant negative effect. The appropriate government intervention in listed agricultural companies will contribute to improve the financial governance efficiency. It has a positive role in promoting the efficiency to improve and perfect the legal system. Based on unperfecting of our legal system, its effect is limited. With the relevant laws and regulations improving, the listed agricultural companies will improve the financial governance efficiency. And the higher agricultural market will promote the financial governance efficiency.(5) Empirical research shows that the centrality of Share and the financial governance efficiency was significantly U-shaped relationship. The percentage of shares held by the executives, firm Size and earning capacity is positively correlated with the financial governance efficiency. The agricultural subsidies is negatively correlated with the financial governance efficiency. The Audit Committee and the board of supervisors meetings num is positively but not significantly correlated with the financial governance efficiency. The asset-liability ratio is negatively but not significantly related to the financial governance efficiency. Otherwise, the Dimensions matching method used to obtain matching samples-manufacturing companies showed their different characteristics. The moderate concentration of ownership will help to improve the financial governance efficiency. The debt size did not play an active role on the financial governance efficiency. The audit committee and board of supervisors improve the financial governance efficiency, but it had little effect. By descriptive statistics can be seen, The percentage of shares held by the executives average 0.9%, which is relatively low. But it can alleviate the conflict between management and shareholders and improve the financial governance efficiency. The clear distortion of financial information can protect the interests of outside investors, improve the financial governance efficiency.3.Main innovation in the thesis (1) The author put forward clearly to the four specific objectives of the financial governance. The first one is to incomplete financial contracts in order to achieve the higher financial governance efficiency. The second one is to reduce agency costs by optimizing the internal governance structure to enhance the financial governance efficiency. The third one is to reduce information asymmetry on the enterprise value of the damage by the effective disclosure of financial information. The fourth one is to improve operational efficiency by the financial governance efficiency.(2) Based on the previous research, the author support the redefinition of the concept of financial governance. The financial governance is a governance form between the corporate governance and the financial management. And it is a series of institutional arrangements to allocate effectively the financial power at the shareholders, creditors, board of supervisors and managers. Financial right should include the financial control and the financial residual claims, and financial control can be subdivided into the financial decision-making power, the financial supervision, the financial executive power and the financial income distribution.(3) Building the theoretical framework. Based on the theoretical framework, the author find the factors affecting the financial governance efficiency. We make a inquiry at the factors of financial governance efficiency. And then, we use the indicators of Financial Governance Efficiency and build Model to analyze. After the regression analysis, the correlation between the variables and the regression parameters of the equations is obtained.(4) This paper use the dimensions matching method to research the factors affecting the financial governance efficiency in the agricultural and non agricultural enterprise. The purpose is to highlight the specificity of the listed agricultural companies.4.Policy proposals in the thesisGrounded on the macro-standing position, this paper support that we should change the government functions and regulate the government behavior. And we should improve the legal system and the legal protection. We also should actively promote the process of agricultural industrialization.Grounded on the micro-standing position, this paper support that we should foster the risk awareness of agricultural enterprises. We should determine a reasonable capital structure and strengthen the debt constraint functions. The listed agricultural companies should optimize the agricultural structure. We also should full use of management equity incentives and strengthen the audit Committee and the board of supervisors. It's importment to standardize and improve the information disclosure system.