The Research On Problem Of The Profit Transfer And Embezzlement Of The Controlling Shareholder's Of The Listed Company In China

The stock right of listed companies is very disperse in countries, such as Britain and America, whose stock markets have highly developed. Because of the lack of controlling shareholders,the problem of profit transfer of controlling shareholder does not exist. It is common that Chinese listed companies have a controlling shareholder holding higher share proportion. The controlling shareholder can take advantage of its special controlling status to influence operating policies of listed company. This behavior affects the normal business activities of listed companies and strikes the investors'confidence seriously. But in real economic activities, the controlling shareholders support the listed companies sometimes : When the listed company encounters financial difficulties , the controlling shareholder will request the local government to supply financial assistance or transfer their own resources to help it escape the crisis directly; When the listed company needs to meet the requirements of issuing or ration stocks,the controlling shareholder will transfer profit from other companies he/she controlled into that company to increase its level of earning, qualifying it for issuing or ration stocks. Therefore,it is an issue to be resolved in our country's security market that how to control the controlling shareholders'behaviors of profit transferring and ensure a healthy and orderly development of the listed company. The core concern of this paper is the influence of the controlling shareholder's profit transferring to the listed company. The main part of the paper contains two aspects:the empirical study and the case study. The empirical study is based on the Chinese context and uses 2003-2006 report data of the stock market of China as the sample. Then,it tests the influence of ownership structure on the controlling shareholder profit expropriation of the listed company by the multiple regression method. It introduces two types of the controlling shareholder profit expropriation by two case studies:It is harmful to the development of listed company if the controlling shareholder transfer profit for the short-term purpose. This act should be suppressed; It is helpful to the development of listed company if the controlling shareholder props for the strategic purpose. It should be supported of such acts.