The Impact Of Corporate Value On Controlling-family Equity Adjustment

As a form of organization,family business has become an indispensable force in business organizations.At December 31,2015,there were 1440 family enterprises listed on Shanghai and Shenzhen Stock Exchange,accounting for 49.24% of all listed companies.Family business play an important role in China's economic development.Controlling-family's equity affect the control of the enterprise and corporate governance.In fact,some of the family reduce the shares of listed company,while others increase.The change of ownership structure is the result of the controlling-family weigh the benefits and costs,so it is necessary to study adjustments of controlling-family's equity.The value of the company is an indicator for investors to make decisions,and the controlling-family must consider the value of the company.Family business face with different control of the risk,so,under the different risk of control,how differernt the value of the company influence to family ownership adjustment?This paper reviews the influential factors of equity structure and the motivating factors of equity adjustment,analyzes the current situation of the dynamic adjustment of the family firm's equity in China,and constructs the Logit model by studying the sample data of the 377 listed companies in Shanghai and Shenzhen from 2008 to 2015.This paper testifies the influence of the firm value on the adjustment of the proportion of the family equity,and draws the following conclusions:(1)The higher the firm value is,the more the controlling-family tends to dilute the share and get higher premium income;the lower the firm value is,the more the controlling-family tends to enhance the share and at a lower price to enhance the control of the firm.(2)The risk of control reduces the likehood of controlling-family diluting the share and improve the possibilitily of controlling-family to enhance their share.(3)Under the different risk of control,the impact of family enterprises equity adjustment factors are also different.Under a low risk of control,the firm value and the risk of control affect the dilution of equity in family firms at the same time.Under a high risk of control,the risk of control suppresses the role of company value in equity adjustment,and the control risk is the key factor to enhance the equity of family enterprise.This study not only enriches the relevant content of ownership structure and reveals the motives of the family equity adjustment,but also provides some reference for the family firm to optimize the equity,which is helpful for investors to make investment decision,and provides a basis for more regulatory authorities to develop norms to control the behavior of change.Based on the above analysis,this paper suggests that the family should cultivate the sense of control risk and clarify the family planning to do a reasonable equity adjustment.