Study On Capital Structure Influencing Factors Of Family Companies

Whether in the emerging economies of China or in the Western countries with longbusiness histories, family businesses have made great contributions to economicdevelopment and are one of the effective and successful business models. Because thefamily companies in China started late, the majority of family companies are in thedevelopment phase. Capital structure as the long-term sustainable concern core issue,not only affects the financing capital costs and financial risks, but also affects theefficiency of corporate governance. The researches about the family companies’ capitalstructure theorists are lack, and empirical researches are especially less.In this paper, to start with the capital structure status of China’s listed familycompanies, analyse the influence factors of family companies’ capital structure andconduct empirical research. The study is a guide on optimizing family companies’capital structure, giving full play to the advantages of family companies, overcomingthe barriers of family companies’ growth and achieving sustainable development.The contents of this study can be summarized as five parts, the first expoundsfamily business, capital structure theory, and the family companies’ capital structureresearches studied by domestic and foreign scholars.The second describes the capitalstructure status of China’s listed family companies. On basis of2007-2010listed familycompanies’ data samples, found that family companies’ debt-asset ratio tends to rise, butthe debt-asset ratio is not high; debt structure is not rational; higher ownershipconcentration, and sole major shareholder is common.The third part analyses influencefactors of family companies’ capital structure and conduct empirical research. Analysehow the macroeconomic factors, industry factors, family shareholders’ attitudes, andbusiness characteristics affect the family companies’ capital structure, and providetheoretical support for the empirical research. The fourth puts empirical assumptionsbased on theoretical analysis. Based on the2007-2010report data, conduct empiricaltesting using factor analysis by SPSS, and analyse the empirical results. The fifth partproposes proposal of family companies’ capital structure. Considering the capitalstructure’s influnence to family companies’ development, taking influence factors offamily companies’ capital structure into account, combined with China’s actual situation,propose suggestions of optimizing China family companies’ capital structure.