The Study On The Relationship Between Governance Structure And Financial Performance For Private Listed Companies

After the reform and open policy had been implemented, private enterprises sprang up like bamboo shoots after a spring rain and lots of private listed companies which have strength and potential keep coming to the fore. They not only drives development of the regional economic, but also inject new blood into the whole national economy. As the private enterprises grew, old, simple and extensive mode of management can not satisfy the need of enterprise operation, and the transform of governance structure is to take place undoubtedly after the introduction of modern enterprise system. In the meanwhile, financial performance which reflects directly the operating result of an enterprise over a specific accounting period can provide true and trustworthy information for the owners, managers and stakeholder of the enterprises. As a result, how to improve financial performance is the question which every enterprise has to take into account. It's constantly proved in both of theory and practices that the standardization and perfection of governance structure improve the financial performance of private listed companies. Besides this, it is beneficial to the attraction of the investment and loan, promote the private listed companies to break through the bottleneck and realizes the sustainable development. However, to date, there has been relatively little research of the relationship governance structure and financial performance. This thesis takes the effect from culture, economic and region to governance structure into account, chooses the private listed companies in Yangtze River Delta Region as research objects, surveys the correlation of governance structure and financial performance, and finally puts forward the suggestion about the perfection of governance structure, the improvement of financial performance and the sustainable development of private listed companies.Firstly, this thesis clarifies the background, significance, goal, methods, basic framework and innovation points of the research in the chapter 1 (Introduction); this thesis defines related core concepts and summarize the predecessors'research results from three governance structure's latitudes in chapter 2 (Literature Review)Secondly, it will contrast and sum up the extant theoretical models which include British-American governance model, German-Japan governance model and Southeast-Asia governance model so that private listed companies in China can sucked knowledge out of their experience. In the meanwhile, this thesis summarizes the development path and characteristics of governance structure in Yangtze River Delta Region. Finally, it analyzes the existing and influencing Factors.Thirdly, this thesis builds a framework of empirical research and puts forward the related hypothesis about immanent correlation of governance structure with financial performance. It chooses 126 private listed companies as research objects, makes use of Excel and SPSS software to have the qualification analysis and empirical test. Besides this, it analyzes the results of the empirical test.In the end of the thesis, it put forward the advices from three aspects which are ownership structure, board structure and the prompting mechanism in order to improve the governance structure of the private listed company. Last but not least, this thesis summarizes the main conclusions:the perfection of governance structure can improve the financial performance of the private listed company; the increase of the first big shareholder's stock-keeping ratio can improve the financial performance; if more shareholders join in the board, the financial performance will be better; the expansion of board can brings better financial performance; it is a effective method to improve and perfect the independent director system; the increase in the number of board meetings can improve the financial performance; the elevation of executive officers'salary will see better financial performance; the import of stock incentive system is beneficial to improve the financial performance of the private listed company.