Research On The Application Value And Implementation Effect Of Dual-class Share Structure

In recent years,the contention of control rights between the founders of Chinese enterprises and institutional investors or controlling shareholders often occurs.The reason is that equity financing has led to the dilution of the founder’s equity.Under the system of "same share and same right" in China,the indispensable capital demand for enterprise development makes the contradiction between equity financing and control difficult to resolve.In this context,the dual-class share structure is considered as an innovative corporate governance model to ensure control while equity financing.In recent years,China’s Baidu,Jingdong,Alibaba and other well-known companies have chosen to list overseas,the most important reason is that foreign companies can adopt the design of dual-class share structure.China’s mainland capital market holds that the dual-class share structure violates the "same share and the same rights" system and temporarily prohibits the application and trading of dual-class share structure enterprises.Against the background of increasingly fierce competition in capital markets and global economic integration,in order to improve the competitiveness of China’s capital markets,China has to re-examine and consider the rationality and applicability of the dual-class share structure.On the basis of literature research,this paper first analyzes the application value of dual-class share structure in China at the present stage from the theoretical level.Secondly,this paper selects Alibaba,which has successfully listed in the United States with dual-class share structure,as the main body of the case study,and takes the "partnership system" of dual-class share structure as the specific object of the case study to deeply understand its main content,operation mode and institutional guarantee.Combining with the practice of the partnership system,this paper explores the prerequisites for Alibaba to implement the partnership system,the rationality of the partnership system,and the implementation effectiveness of the partnership system.Finally,the paper summarizes the experience and enlightenment brought by the design of dual-class share structure for the development of enterprises in our country at this stage.At the same time,in view of the potential risks of dual-class share structure and the existing problems in China’s legal and regulatory systems,this paper provides relevant policy recommendationsThe main conclusions of this paper are as follows:firstly,dual-class share structure has certain theoretical logic and practical rationality;secondly,to meet the actual needs of China’s capital market,China is necessary to introduce dual-class share structure;thirdly,dual-class share structure has a positive impact on the development of the company.fourthly,the implementation of dual-class share structure has preconditions.The innovation of this paper is to reveal the influence mechanism of social capital and human capital on the founder’s acquisition of control in the era of knowledge economy,and to deepen the theoretical research on dual-class share structure.The purpose of this paper is to provide reference for entrepreneurs facing the risk of control,and to provide some ideas for the introduction of dual-class share structure 1 in the future.