Study On The Relationship Between Ownership Structure And Business Performance Of Chinese Family Businesses

Family business is an important component of Chinese enterprises, and the development of family businesses is related to sound and fast development of the national economy, thus the study of business performance of family businesses is of great significance. How to create better institutional environment to improve business performance of family businesses is one of the core issue in family business governance. The ownership structure of family businesses is the starting point and the foothold of corporate governance structure, and the process from family ownership structure to business performance is complex, which involves a relatively large risk and uncertainty, and the internal control of family businesses can effectively control and reduce these risks and create a favorable institutional environment for the undergoing business of family businesses orderly. Based on the above considerations, the paper selects listed family firms as the research object, and analyzes the influence of ownership structure on the business performance on the perspective of internal control.This paper bases itself on the analysis of related researches of ownership structure, business performance and internal control of domestic and foreign family businesses, putting forward the proposition of this paper:study on the relationship between the ownership structure and business performance of family businesses based on internal control perspective. On this basis, the paper carries on the empirical research by using family businesses of SME board in 2011-2013 as a sample, and built the mediator test model of internal control with reference to mediating effect test method proposed by Baron, and the results show that family shareholding and business performance show negative correlation, and the top ten shareholding, S index and business performance show positive correlation. When substituting the internal control variable into the model as an mediator, we find that internal control plays a conduction effect completely between the family shareholding of family businesses, ownership concentration and business performance, and partial mediating effect between equity balance and business performance. This paper aims at high controlling stake family businesses specifically, and places ownership structure, internal control and business performance of the family businesses in an overall framework for analysis. On the one hand, it complements the vacancies which the existing researches' only focusing public companies and ignoring the family business research. On the other hand, it makes up for the situation in which existing researches only use regression equation approach to study the correlation between corporate ownership structure and business performance simply, and reveals the conducting "black box" of internal principle from ownership structure to business performance.