Empirical Analysis Of China's Listed Companies Shareholding Structure And Corporate Performance Relationship

Ownership structure is the interior structure of corporate owners, which determines corporate governance. The efficiency of corporate governance is embodied by the corporate performance. The study of ownership structure and corporate performance is carried out through combining the theoretical analysis and empirical analysis. Based on the review of related literature, the status of ownership structure of the listed companies in China and the character of stockholder's behavior are analyzed and the concept of ownership structure is defined. Whether the ownership structure significantly affecting corporate performance is emphatically studied according to the agent theory.In order to analyze the correlation between ownership structure and corporate performance from the angle of industry, this paper quotes 28 listed steel industry companies as samples, which started public offering in Shanghai and Shenzhen stock market before Dec 31, 2001, takes the relative data during 2002-2004. This paper adopts parallel data to analyze the correlation between ownership structure and corporate performance of the listed companies in steel industry of China and studies different ownership structure how to affect corporate performance in the same competitive environment.Several conclusions have been drawn. Firstly, the proportion of state ownership is negatively related with corporate performance, the proportion of legal ownership is positively related with corporate performance and there is no significant relation between the proportion of circulating shares and firm performance. Secondly, we find a significant curvilinear relation between ownership concentration and corporate performance, the curve slopes upward as the increasing of ownership concentration and then slopes slightly downward.Based on these conclusions, we have some policy recommendations. Firstly, arrange ownership structure reasonable and form diversified ownership structure. To adjust ownership structure and improve corporate governance, it is the valid approach that reducing the proportion of state-owned stock properly and enhancing the proportion of legal ownership steadily and introducing the institutional investors actively. Secondly, ownership concentration should be kept properly and the shareholding percentage of large shareholders should be declined to achieve ownership control.