A Empirical Study On The Institutional Shareholder Activism In China Listed Firms

Over the past 30 years, the world's major capital markets institutional investors has been rapid development .As the original shareholding limit laws and regulations on institutional investors have been changed, institutional investors have replaced the individual investors as the main capital market investors, and completely change the company's shareholding structure. With institutional investors holding the expansion of the scale, raising the proportion of shares held, and its status and role in the company rising, In-depth analysis of institutional investors's role and influence in corporate governance and corporate financial policy have become an important issue to the theoretical and the practice circle.In the course of development of China's institutional investors, we can easily find the rapidly development of Chinese institutional investors benefit from the government regulatory authoritie's positive attitude. In Chinese securities market, in the situation of the controlling shareholders of listed companies frequently tunneling the company, and against the interests of small shareholders, the government has high expectations on the institutional investors. In 2006, CRSC published governance guidelines of the listed companies in China, in article 11 states: "institutional investors should play an active role on the company directors elected, encourage and supervise company excutive, and other major decision-making." In recent years whether the institutional investors have a direct or indirect positive impactd on the mechanisms governance of listed companies and the financial decision-making behavior of the listed companies? If playing an active role, then in what aspects? If not, then constraint to what factors? On the basis of systematic analysis the rise,the evolution and the economic the root of institutional shareholder activism in the developed countries , in the context of our special circumstances of controlling shareholders of listed companies in their own interests to consider and adopt the dividend, refinancing policies, This paper study whether institutional investors play a active role . At the same time China's listed companies' Non-tradable Share Reform is the rare purity test events to the study of the institutional shareholder activism and its effectiveness. The full text is divided into nine chapters, major elements of each chapter as follow:Chapter 1 is an introduction. It includes such contents as research background, issues under research, research framework, major research contents, improvement and innovations of this paper. Chapter 2 is the literature review. First, review the concept of the shareholder activism and the formation and development of shareholder activism in United States. Second, review the literature of institutional shareholders activism.Finaly, summarized the effectiveness of the institutional shareholders activism.Chapter 3 analysis the mechanism of institutional shareholder activism.First, describe the ways and means used by institutional investors, then summarizes the positive factors impact on institutional shareholders activism.Finaly, building an institutional shareholders activism theoretical model.Chapter 4 introduces the background of Chinese securities market. First, list the existence of corporate governance issues on Chinese stock markets. Second, instroudce the development and the present situation about the various types of domestic institutional investors. Finaly, uses case study methold analysis the institutional shareholders activism.Chapter 5 investigates the relation between the institutional investors and listed companie's dividend policies.Based on the special shareholding structure system background, in the view of the cash dividend policy of two theoretical viewpoints - "free cash flow hypothesis" and the "transfer of benefits hypothesis," as well as "abnormal dividend" phenomenon, this paper empirically test the institutional shareholders activism.Chapter 6 investigates institutional shareholders activism.during the vote in the classification system.Useing the 2001-2004 refinancing listed company , compares the different stock market responses and the long-term effect after refinancing of different institutional investors holding to empirically test whether institutional investors play a play an active role during company refinancingChapter 7 use the listed companies in China Non-tradable share reform as the background, from three perspectives: the price level of payed by the company, the price difference after programe revised and the wealth value-added in the process of non-tradable share reform to emperical test the institutional shareholders activism.Chapter 8 from operating performance and market performance perspective investigates the relationship between institutional investors holding and the company's performance .In the course of the study considered the possible endogenous between, institutional investor's holdings and corporate performance.Chapter 9 sums up the research findings of this paper, including its research conclusions and lessons, research limitations and the direction of further research.The main findings of the paper on the performance of diversification are followings:First, Based on the special shareholding structure system background, in the view of the cash dividend policy of two theoretical viewpoints - "free cash flow hypothesis" and the "transfer of benefits hypothesis", institutional investor have no effect on company payout policy. However, according the "abnormal dividend" phenomenon, the higher institutional investor's holdings the lower probability of "abnormal dividend"Second, in the vote classification system, the higher institutional investor's holdings the lower probabilities of company refinancing programe pass. The stock market responses and the long-term effect of refinancing company are better when institutional investor's holdingsThirdly, Institutional investor does not play a play an active role during Non-tradable share reform.Finaly, Institutional investors invest in the company which profitabilityis high, but at the same time had a positive role in promoting company performance.