Research On Multiple Large Shareholders And Share Repurchase Of Listed Companies

Share repurchase is a basic institutional arrangement in the capital market.It is a process in which listed companies repurchase their outstanding shares.In the mature capital market,share repurchase has gradually become an indispensable financial activity.The company has great randomness and flexibility in share repurchase,which makes share repurchase play an important role in supporting the company’s mergers and acquisitions,optimizing the governance structure and stabilizing the stock price.Especially when the market faces unexpected factors that lead to the continuous decline of the share price of listed companies and the general undervaluation of the company’s value,share repurchase sends a positive signal to the market,which helps to reduce investors’ panic and provide an important guarantee for stabilizing the share price and maintaining the healthy development of the capital market.Share repurchase of listed companies plays an important role in the company’s business activities and the healthy development of the market.Relatively speaking,due to the early regulatory constraints,China’s share repurchase presents an obvious situation of "prohibition in principle and exception permission",which directly leads to less and less enthusiasm of listed companies to implement share repurchase.However,with the continuous progress and improvement of the capital market,in recent years,China’s regulatory authorities have gradually liberalized the requirements for share repurchase of listed companies,and the enthusiasm for share repurchase of companies is also rising day by day.Therefore,at this time,the research on share repurchase of listed companies in China is of great significance for the exploration of policy implementation and the supervision of corporate governance.At present,my country’s capital market is still in the stage of emerging and transitional,and the shareholding structure of listed companies is highly concentrated.However,apart from this obvious feature,after the completion of the split share structure reform,the shareholding ratio of the largest shareholder has shown a downward trend year by year.In addition,with the advancement of the reform of state-owned enterprises and the proposal of mixed ownership reform,decentralization control has introduced other large shareholders,which has led to the coexistence of multiple large shareholders in the equity structure of my country’s listed companies.Several large shareholders are important providers of the company’s equity capital.Due to their relatively high shareholding,they play a key role in the company’s operations.Their motives and behaviors affect the corporate governance environment and financial decision-making.At present,many large shareholders have become an important research topic in the field of corporate governance.Share repurchase affects the company’s performance,changes the company’s equity distribution,and affects the interests of shareholders.In the equity structure where multiple large shareholders coexist,how will it affect listed companies with the grand occasion of the implementation of share repurchase? This is worthy of attention at present.Based on this,this thesis attempts to explore the influence of multiple large shareholders on the company’s share repurchase behavior.On the basis of existing research,this thesis combines theoretical researches such as information asymmetry theory,signal transmission theory and principal-agent theory,and adopts the research methods of literature research,deductive derivation and empirical analysis.This thesis deeply studies and analyzes the motivation,influence mechanism and economic consequences of the shareholding structure of multiple large shareholders on the share repurchase of listed companies.When examining the effect of multiple large shareholders on the share repurchase of listed companies,it is considered that changes in the implementation of share repurchase of listed companies are not due to the role of multiple large shareholders,but are due to unobserved omitted variables or endogenous factors such as selection,this thesis uses Propensity Score Matching,Heckman two-stage and fixed-effect models to solve the problem.Taking A-share non-financial listed companies in my country from 2011 to 2019 as the research sample,we empirically test the influence of multiple large shareholders on the share repurchase behavior of listed companies,and further starting from the two paths of non-controlling shareholders’ enthusiasm to participate in decision-making and non-controlling large shareholders’ exit threat,to explore the mechanism of multiple large shareholders’ share repurchase behavior of listed companies.Then,it explores the economic consequences of investment efficiency,corporate risk-taking and corporate value.The findings of this study are as follows.Firstly,multiple large shareholders will have an impact on the share repurchase of listed companies.By combing the disclosure of share repurchase of listed companies,it is found that the company repurchases its shares more due to market value management or equity incentive.One is that the stock price can not reflect the value of the company,so as to enhance investors’ confidence in the company;The other is to stabilize investors’ expectations of the long-term intrinsic value of stocks,improve the company’s long-term incentive mechanism,and lead listed companies to implement share repurchase decisions.However,in the actual implementation process,share repurchase has great autonomy and controllability,which can provide a shortcut for the management and large shareholders to transmit their interests,so that they can meet the purpose of opportunistic behavior through repurchase decision-making.In the empirical analysis of share repurchases between multiple large shareholders and listed companies,it is found that compared with a single large shareholder company,multiple large shareholders will less repurchase shares of listed companies,and this inhibitory effect is more significant when the number of other large shareholders is more.At the same time,we find that when the shareholding ratio of other large shareholders is higher,the relative shareholding ratio is higher,there is no controlling shareholder,and in private enterprises,the supervision effect of multiple large shareholders is also more obvious.Then,after further analyzing the impact of other situations,it is found that the differences in the company’s information environment,the company’s operation and the marketization process will affect the supervision role of multiple large shareholders,and when the higher the company’s information asymmetry,the more analysts follow,the higher the management’s shareholding,the lower the financing constraints and the lower the marketization process,the greater the possibility of reducing the share repurchase behavior of listed companies.Secondly,multiple large shareholders can influence the share repurchase of listed companies by influencing the behavior of non controlling shareholders.In the study of the influence mechanism of the coexisting ownership structure of multiple large shareholders on the share repurchase behavior of listed companies,it is mainly combined with the behavior of non-controlling shareholders to analyze and study from the perspectives of non-controlling shareholders’ enthusiasm to participate in decision-making and non-controlling major shareholders’ exit threat.The study found that the participation of multiple large shareholders in governance may increase the enthusiasm of non-controlling shareholders to participate in corporate decision-making,and the supervision of non-controlling shareholders can help to further enhance corporate governance capabilities,thereby reducing the share repurchase due to the transfer of control or hollowing out the interests of the company.Moreover,listed companies with multiple large shareholders participating in governance will increase the threat of exit of large shareholders in the company due to the supervision effect,so as to effectively alleviate the agency conflict between shareholders and reduce the opportunity for controlling shareholders or management to encroach on interests by means of share repurchase.Lastly,the share repurchase of listed companies under the governance of multiple large shareholders can reduce the occupation of repurchase funds through capital ratio,effectively improve the company’s investment efficiency and reduce inefficient investment.In the research,it is found that it can better reduce the phenomenon of insufficient investment.This may be mainly due to the fact that the implementation of share repurchase of listed companies needs financial support and occupies the company’s capital resources.After the repurchase behavior is supervised by multiple large shareholders,the occupation of share repurchase can be restrained,and then the capital use efficiency can be improved,so as to make up for the lack of investment of the company.Relatively speaking,the occupation of funds may not have a significant impact on over investment.At the same time,this governance structure can effectively improve the level of corporate risk-taking and capital allocation,so as to enhance the competitiveness of the company.It can also improve the company’s business performance and promote the company’s long-term development.The main innovations of this thesis are as follows:Firstly,taking the revision of my country’s corporate share repurchase system as the research background,combined with the governance effect of the coexisting ownership structure of multiple large shareholders,it provides a new perspective for the study of listed companies’ share repurchase.Existing research is mainly based on the background of developed foreign capital markets to explore the causes,management behaviors,investor reactions and economic consequences of share repurchase in listed companies.Most of them are based on the structure of decentralized equity.However,considering my country’s special national conditions and the company’s shareholding structure,this thesis takes the relevant system of the company’s share repurchase as the background to explore the behavioral responses of the management,controlling shareholders and other large shareholders of listed companies when the legislation is in its infancy.The research on corporate share repurchase provides new ideas.Secondly,enrich the research on corporate governance under the structure of the coexistence of multiple large shareholders.Existing research has not reached a consistent conclusion on whether corporate governance is "optimized" or "deteriorated" when multiple large shareholders coexist,but multiple large shareholders play a "collusion" role in family-owned enterprises.Share repurchase is a basic institutional arrangement in the capital market.It was born as an airborne soldier in the early days to maintain market development,stabilize stock prices,and protect investors’ interests.Combined with the current implementation of share repurchase in my country’s listed companies and considering the specific situation of my country’s stock market,this thesis discusses the implementation motivation of controlling shareholders and management in the financial decision-making of share repurchase,dynamically simulates the intervention of multiple large shareholders,and combined with the behavior research of multiple large shareholders on shareholders,we can deeply understand the behavior motivation of large shareholders and contribute to corporate governance.Thirdly,deepen and promote the understanding of the behavior of controlling shareholders and non-controlling shareholders.In companies with highly concentrated equity,the controlling shareholders have an absolute voice in the company’s business decisions because they hold a high proportion of the company’s shares.As a highly controllable information,share repurchase is extremely flexible,so it may provide a manipulative space for the controlling shareholder’s market value management motivation and encroaching interest motive,and become a way of earnings management.At the same time,considering that the share repurchase behavior of listed companies is closely related to the stock price,when the stock price falls,the market value held by the controlling shareholder will change accordingly.Because of the larger shareholding ratio,they are more sensitive to the stock price.In comparison,although the shareholding ratio of non-controlling shareholders is lower than that of controlling shareholders,the power they can enjoy is still insufficient,but based on the protection of policies and regulations and their influence in the market,there are also certain opportunities to compete with them.Therefore,this thesis analyzes the non-controlling shareholders’ participation in decision-making initiative and non-controlling large shareholders’ exit threat,and provides a reference method for subsequent improvement of company agency conflicts.Lastly,based on the background of my country’s policy,to explore the corporate governance and economic consequences of listed companies after the wave of share repurchase is conducive to face up to the implementation effect of national policies,and to provide reference for policy improvement.Since my country’s regulatory agencies have gradually revised policies and regulations,continuously expanded the situation of listed companies’ share repurchase,and gradually loosened the restrictions on listed companies’ share repurchase,the listed company’s share repurchase has attracted much market attention.This thesis enriches the research on share repurchase in my country,and plays an important role in correctly guiding and implementing the execution of share repurchase in listed companies.