Research On The Influence Of Controlling Shareholder's Equity Pledge On The Value Of The Company

Because the equity pledge operation process is relatively simple and convenient,equity pledge has also become the preferred method when companies choose financing methods.Although equity pledge can broaden the financing channels of the enterprise and can also motivate the controlling shareholders,its negative impact cannot be ignored.This article will explore how the controlling shareholder's equity pledge will affect listed companies.This article takes Geo-Jade Petroleum Corporation as an example,taking its frequent pledge times and a high proportion of pledge behavior as research objects.First,by analyzing the changes in various financial indicators before and after the intercontinental oil and gas pledge,it can be seen that the controlling shareholder Guangxi Zhenghe's pledge of equity has weakened Geo-Jade Petroleum Corporation solvency,liquidity and development capabilities,etc.Secondly,by analyzing the event analysis method,it is concluded that equity pledge In the short term,it will cause the company's stock price to rise,but it will have a negative impact on its long-term market value.Thirdly,using Tobin's Q value to analyze the changes in the value of Geo-Jade Petroleum Corporation Company after the equity pledge,it can be seen that the controlling shareholder Guangxi Zhenghe has impaired Geo-Jade Petroleum Corporation.Company value;Finally,when analyzing the impact of the intercontinental oil and gas controlling shareholder's equity pledge on the value of the company,it was found that the severe separation of cash flow rights and control rights made it easier for large shareholders to hollow out the company's interests and related party transactions.The problem of taking up company funds.This article proposes the following suggestions to listed companies on the impact of the above-mentioned intercontinental oil and gas controlling shareholder's equity pledge on the company:(1)Strengthening the supervision of the controlling shareholder's behavior,establishing a settlement mechanism for violations of equity pledges,and providing corresponding penalties for repeated violations(2)Improve the transparency of information disclosure,strengthen the integrity of information disclosure,and separately disclose the number of equity pledge freezes and pledges,and strengthen the supervision of information disclosure;(3)Improve relevant laws and regulations on equity pledges and strictly and reasonably restrict the controlling shareholder's equity pledges.