External Monitoring?Company-Paid Consumption And Corporate Performance

Company-paid consumption has always been one of the problems highly-concerned by country and companies, especially for the state owned companies, whose excessive company-paid consumption attracts much concern from the people and the media at home and abroad. For a long time, research on company-paid consumption is comprehensive and mature, but unfortunately, most of the literature stands at the micro level, seldom research the micro company's behavior on the macro background, especially in china, related literature is much rarer. China is the biggest transformed-economy country in the world, in its revolutionary development process, management efficiency of state owned companies remains further improvement, especially the company-paid consumption. On February 13 th 2012, the Ministry of Finance jointly State-owned Assets Supervision and Administration Commission, Auditing Administration and Ministry of Supervision jointly issued the interim measures for the supervision and administration of position-related consumer behavior of executive officer of state-owned enterprises(hereinafter referred to as “management measure”), in order to further implement the conference spirit of state council for the fourth time honest work, strictly regulate the position consumer behavior of state-owned enterprise position, resolutely put a stop to position consumer behavior and luxury consumption culture which has nothing to do with the enterprise operation and management. As an exogenesis policy, the “management measure” at the national level and government regulations from provinces?autonomous regions and municipalities can remedy the insufficiency of company-paid consumption choice of current literature. Under this background, this paper analyzes the impact and economic outcome of external supervision to micro enterprise behavior.Based on the external supervision as the “management measure” background, this paper chooses Chinese A share listed companies from 2010 to 2014 as research object, empirically researches the impact and economic outcome of external supervision to micro enterprise behavior, meanwhile, this paper studies the difference impacts of external supervision to differential property rights companies under different marketization process. From the empirical study, this paper gets the following conclusions:(1)As a whole, external supervision policy purifies the market in some degree, well restrains the company-paid consumption problem in companies, especially in state-owned companies.(2)Under different marketization process, the external supervision effects are different among companies whose property rights are different, specifically, compared with companies in high marketization degree region, companies especially the non-state owned companies in low marketization degree region get more significant impact from external supervision.(3) the suppression of external supervision to company-paid consumption has positive effects on performance of companies, but there is difference among state-owned and non-state owned companies under different marketization process, specifically, low marketization degree is much beneficial to central state-owned companies, while high marketization degree is much beneficial to regional state-owned companies and non-state owned companies. This research not only proves the impacts and efficiencies of central supervision, but also provides a domestic empirical study, which enriches the current related literature and empirical evidence for better policy and regulation making in China.