The Research On The Motivation Of The Listed Companies' Behavior Of Changing The Investment Project In China

Raise funds in capital markets for sustainable development of a company has been an important channel of collecting necessary money. However, lots of companies change the committed investment projects seriously after a successful fund-raising, and this is a unique phenomenon in the stock market of China. This large-scale, high amount behavior of change is harmful for small and medium-sized investors'interests, damages the credibility of listed companies, even distort the stability and healthy development of China's capital market. The reasons of change are complex and multi-level, including well-intentioned to adapt market changes and malicious motive to obtain the private benefits. Such behavior not only expose many problems in terms of decision-making and corporate governance structure of listed companies from the microscopic description, but also discover some defects of laws and regulations in the capital market from a macro point of view.In the paper I used the methods of descriptive statistics, theoretical analysis and empirical testing to analyze the motivations of changing the committed investment projects. By manual classification, I used objective data to analyze the present status and features, the reasons of notices, and the whereabouts after changing, then used the option theory and control theory to explain two motives for the behavior of changing, used the OLS linear regression to research the influencing factors and the impact on company performance. The results show that:the competition of product market, the president of the board and general manager combine into one, related transactions significantly positive correlates with the change's probability, the proportion of independent directors, and asset size significantly negative correlate with the change's probability. It confirms that the change of behavior is influenced by all aspects including market factors, corporate governance factors, and the financial characteristics. However, it also obtained some different conclusions from the previous:the percentage of largest shareholder's ownership significantly positive correlates with the change's probability, the reason to consider is that largest shareholder plays more on "support effect " instead of "tunnel effect". Size of idle funds, asset-liability ratio before changing positive correlates with the change's probability, ROE before changing negative correlate with the change's probability, but not significant. Finally, the time from raising funds to change the committed investment projects has little effect on the change's probability, more and more companies change the amount of funds had nothing to do with the control of time. At the end, I provided some references for improving the efficiency of the financing capital's use and the development of the capital markets on the base of the related research.