The Relationship Between Control Ownership Wedge?Related Party Transactions And Firm Value Of Family Controled Listed Companies

In recent years,the rapid development of family controlled listing companies have made a prominent contribution to the economy of our country.In the same time,the family control listing companies also have a lot of problems to be solved.The ultimate controllers make foil use of their control rights over the listed companies to seek their own interests through related party transactions.The real controllers transfer resources from the listed companies and grab the private benefits from the process.Having the private benefits not only damaging the interests of minority shareholders,but also reducing the integrity and profitability of the enterprises in the capital markets.Although regulatory departments supervise the related party transactions and increase the punishment,there are still more corporate governance issues which are difficult to solve fundamentally because of the hidden nature of the ultimate controlling.The main content are as follows:(1)Based on domestic and abroad relevant literature reviewed,this paper applied the normative analysis method to study the relationship between control ownership wedge related party transactions and firm value in terms of transaction costs theory,principal agent theory and self interest theory.(2)Selecting 61 family controlled listing companies to find the actualities of control ownership wedge and related party transactions.The family control listing companies in our country always exist the control-ownership wedge and the wedge is high.Related-party transactions occurred more of the family controlled listing companies and most of related-party transactions are providing security and trading.(3)With selecting the data of 61 family controlled listing companies from 2004 to 2014,the research finished empirical tests the relationship between control-ownership wedge related party transactions and firm value of family controlled listing companies.The control ownership wedge reduces firm value of family controlled listing companies.The related party transactions of providing security and trading are the bridge of the relationship between control ownership wedge and firm value.(4)According to the conclusions of this paper,we give some advises to government investors and family controlled listing companies.