An Empirical Study On The Effect Of The Listed Companies’Corporate Governance Structure On Business Performance

As a core issue of enterprise development, corporate governance structure can not only promote the enterprise’s own standardized development, but also it can maintain the financial markets’stability and healthy development. Given its importance, problems about corporate governance structure have been the research focus of the domestic and foreign scholars, and the empirical research on the relationship between corporate governance structure and business performance has been the most prominent. As the scholars came from different backgrounds and selected different samples, different data interval, different indicators and other different factors, conclusions of the study on the relationship between the two are not consistent. In addition, specific to our country, you can find that a lot of papers focused on problems of listed companies before and in the split share structure reform, however, the study on the governance structure of listed companies how to affect the company’s business performance after the split share structure reform is relatively small. Moreover, when the scholars selected variables to describe the corporate governance structure, they more often considered the ownership structure, board governance and senior management incentive, and rarely related to the supervisory board governance which is a fairly important component. Based on the factors mentioned above, this paper chose the period when most listed companies basically completed the split share structure reform, and considered all these four aspects which conclude ownership structure, board governance, supervisory board governance and executive incentive, in order to more truly and comprehensively reflect the effect of the listed companies’governance structure on business performance.This paper uses the method which concludes normative analysis and empirical research. Firstly, this article adopts theoretical analysis on the effect of the corporate governance structure on business performance, and then proposes a series of hypothesis; Secondly, this article conducts empirical analysis on the effect of the corporate governance structure on business performance; Finally, based on the analysis of the empirical part, this paper obtains its conclusions and put forwards the corresponding suggestions.In the theoretical analysis section, the corporate governance structure is divided into four aspects which conclude the ownership structure, board governance, board of supervisors governance, executives incentive, and these four aspects are further subdivided into eleven specific indicators, then this article adopts a theoretical analysis on the effect of these eleven indicators on the company’s business performance and proposes the corresponding eleven hypothesis. In the empirical analysis part, in order to ensure homogeneity, comparability and representativeness of the sample data,126manufacturing companies which listed on the Shenzhen Stock Exchange before December31,2009are used as research objects. In addition, the eleven indicators mentioned above are used as independent variables and the weighted average return on net assets after deducting non-recurring gains and losses is used as the dependent variable. By means of the SPSS17.0statistical analysis software and the methods which conclude descriptive statistical analysis, simple correlation analysis, collinearity diagnostics as well as multiple regression analysis, this article is able to test the effect of the listed companies’corporate governance structure on business performance. In the section of conclusions, recommendations and the outlook, this paper summarizes the conclusions derived from the empirical part, based on the conclusions, the article then proposes some suggestions from four aspects which conclude optimizing the equity structure, improving the board governance, strengthening the supervisory board governance and increasing the intensity of senior management equity incentive to improve the corporate governance structure of listed companies in China. Finally, the paper proposes the limitations of this study as well as the outlook for future research.