Study On Pyramid Structure Ultimate Control,Board Composition And Corporate Performance

In the end of the 1990 s,some academics represented by La Porta found in most of countries ownership concentration is more common.The main conflict of corporate governance is not only the one between managers and owners,but also the one between inner controlling shareholders and small shareholders.Listed company has an ultimate controller in a concentrated ownership structure.The controlling right owned by the ultimate controller may probably exceed his cash flow right.It found that most corporations had concentrated ownership and most of the ultimate controllers build Pyramid shareholding structure.Board composition as an important means of internal corporation controlling plays a very important role in corporation governance,closely related to Pyramid structure.By analyzing Chinese family listed companies over the period of 2010-2014,this thesis investigates how the cash flow right and controlling right of the ultimate controlling shareholder and the deviation of the controlling right and cash flow right influence corporate performance.This paper further studies the constraint effect of the board composition on ultimate controlling shareholder's expropriation.The result show that controlling right had no relationship with corporate performance.cash flow right positively correlated with corporate performance.The deviation of controlling right and cash flow right is negatively correlated with corporate performance,and the ultimate controlling shareholder has an “entrenchment effect”.The result of further study shows that the independent board proportion can constrain the ultimate controlling shareholders' expropriation efficiently and the board size enhance the ultimate controlling shareholders' expropriation efficiently.