An Empirical Study On The Ownership Structure, Diversification And Performance Of The Enterprise Group

So far, the relationship among the ownership structure, diversification and performance has been paid full attention. However, most of the research is based on data of large enterprise groups in western developed countries. At the same time, research on this topic of Chinese enterprise groups has just begun. But as it is very difficult to get information of Chinese enterprise groups in detail, there is more qualitative research than quantitative research on this topic. Therefore, this article selects listed group companies for the sample to explore the relationship among ownership structure, diversification strategy and performance. There are two important questions to research. One is whether both ownership structure and diversification strategy will have an impact on the group's performance. What are these impacts? The other is whether diversification strategy has a mediating effect on the relationship between ownership structure and group performance.To solve these two problems, this paper first analyzes the basic concept of diversification, studies relevant literatures about the relationship among ownership structure, diversification strategy and performance. After the literature, this paper builds conceptual models and basic assumptions and selects the data of Chinese 181 listed group companies. With descriptive statistics and regression analysis to test various hypotheses, this paper draws the following conclusions:(1) The percent of state ownership has a negative impact on the corporate performance, which is an indirect effect; (2) The percent of management ownership has a positive impact on performance, which is a direct effect; (3) Ownership concentration has both direct and indirect effect on performance; (4) Diversification has a negative impact on performance. As a mediating variable, diversification affects the relationship between ownership structure and performance.Based on the findings above, this paper proposes the following measures:(1) Listed diversified group companies should actively promote the management and operation of state ownership in the market; (2) Group companies should increase the equity incentive for executives; (3) Group companies should pay attention to the relevance of various business units and build core competencies.Limited to the research environment and the ability of researchers, this paper has some limitations. Further research could be carried out in the following areas:(1) there are many group companies that are not listed should be included in the scope of study, however, it is very difficult to get relevant information of these enterprise groups; (2) compare the effect of different types and ways of diversification strategies on the relationship between ownership structure and performance; (3) do research using industry as a control variable.