An Empirical Study Of The Impact Of Corporate Governance On Agency Cost

In the 1930 s,Berle and Means put forward the view of the separation of ownership and control,the agency problem became a hot topic of research.Corporate governance became one of the effective ways to solve the problem of agency.Since 1993,our country began to explore the corporate governance mechanisms,so it is very necessary to explore the effectiveness of corporate governance mechanisms.The paper,selecting Shanghai and Shenzhen stock market 15989 listed companies from 2000 to 2013,studies the relationship between 12 classical government elements and two kind of ownership agency cost,which one is the first equity agency cost between shareholders and managers measured by asset turnover,the other is the second equity agency costs between controlling shareholders and minority shareholders measured by receivables to total assets ratio as an index of capital occupation using the ordinary least square and panel data two econometric methods.The results show that equity concentration played the role of reducing two equity agency cost in the short and medium and long term.As to operating mechanism,the relationship between number of meetings of the board of directors and the second kind of agency costs is u-shaped in the medium term,number of meetings of the board of supervisors is negatively related to the first agency costs in the short term,number of shareholders' meeting is u-shaped relation with the first agency costs in the short term and has negative correlation with the second kind of agency cost in the long term.As to decision-making mechanism,the relationship between the size of the board and two types of equity agency costs show U shaped in the long term.As to supervision mechanism,the size of supervisory board size has no significant effect on the first kind of equity agency cost,but has U shaped relation with the second agency cost in the medium term,independent directors proportion has the opposite effect on two types of equity agency costs.As to incentive mechanism,the effect of reducing agency cost between shareholders and managers of is more pronounced;increasing board of directors shareholding and executive pay can effectively reduce the first kind of equity agency costs,but rising executive shareholding and directors pay can increase the first type of agency cost.