Measurement,Motive Identification And Financial Risk Analysis Of Enterprise Financialization

In the background of debased and virtual national economy,the situation of enterprise financialization is increasingly severe.Under the circumstances of declining industry profitability and squeezing profit margins,many traditional enterprises have chosen financial investment with high yields.As a result,stocks and real estate investment have become an essential means for many entities to enhance their performance and increase profits.Financial risks exist in daily corporate operations and investment activities.If the motive of enterprise financialization does not serve the main business purpose,or the degree of financial investment is not properly controlled,excessive financialization will be likely to trigger a series of financial risks.Therefore,it is of great significance to study how to identify and measure the degree of enterprise financialization,what their financial motives are,and how the financial risks of financial assets are transmitted.This practice can provide references for the financial investment of the subsequent enterprises,and also put forward case support for the formulation of policies to prevent excessive enterprise financialization.In this paper,the financial crisis and share price collapse of Shanghai RAAS Blood Products Co.,Ltd.caused by stock investment is selected as a typical case of excessive enterprise financialization.Three mainstream methods of measuring enterprise financialization are employed to calculate and judge the degree of financialization of Shanghai RAAS,where the method of measurement from the perspective of profit is found to be the most suitable.In the meantime,the company's motives of financialization are disassembled and analyzed based on the theories such as "reservoir" and "investment substitution".Finally,under the guidance of the financial risk related theories and starting from the common financial indicators including the main business growth rate,net profit growth rate,cash flow per share,asset-liability ratio,and cash flow ratio of investment activities,this paper has verified the theory of "crowding out" and analyzed how enterprise financialization induces the financial risk,that is,the risk transmission path of enterprise financialization.At the end of the study,the following suggestions have been made from the perspectives of investors,business managers,shareholders and policy makers: first,the identification and measurement of the financialization of non-financial enterprises shall choose the applicable method according to the enterprise characteristics;second,non-financial entities shall reasonably control the degree of financial investment and make finance return to its original intention of serving the main business so as to seek synergistic development and joint progress;third,major shareholders and managers shall be responsible for the enterprise by properly weighing the short-term benefits brought by financial investment and the long-term objectives of business operation;last,policy makers should respond to the problem and improve the business environment.