Research On The Influence Of Dual Class Share On Corporate Internal Governance

The shareholding structure is the foundation of corporate governance,which determines the distribution of shares and the identity of major shareholders.It is able to influence the way and effect of shareholders'exercising power,and it is reflected in the formation,development and business results of the corporate governance model.As long as shareholders have investment,they will have certain decision-making right,but the difference is the degree of participation and influence of decision making.Always,to ensure fairness,China adheres to the principle of "one share and one power",that means each share has only one voting right,which has the same effect,We do not allow one share with multiple voting rights.However,with the fast development of science and technology and the economy,a large number of Internet companies such as Jingdong and Meituan have listed overseas in a dual-equity structure,among them,Alibaba Group is the most influential and the highest IPO amount.Although the Alibaba Group insists that it adopts the "Partnership",the essence is still a dual shareholding structure.The dual shareholding structure is not allowed in China's capital market,but it is very mature in the United States,Canada and other countries,especially in high-tech enterprises,such as Google and Facebook,etc.In order to introduce a dual ownership structure in the future,it is very necessary to conduct an in-depth study.This paper first introduces the concept and characteristics of the dual equity structure and the meaning of internal corporate governance,analyzing the impact of dual ownership structure on internal governance of the company from the perspectives of shareholders,company founders and directors.Then by introducing the background information of Alibaba Group's development process,financing experience and listing process,the paper introduce the partnership,analyzing it detailly,including the reasons for adopting the partnership system and its impact on the internal governance of the Alibaba Group.Finally,this paper compares the similarities and differences between the partner system and the dual shareholding structure,and summarizes the impact of the partner system on the internal governance of Alibaba Group.The dual shareholding structure is a double-edged sword.Although it resolves the contradiction between"financing and control is diluted",it strengthens the control of the founder and maintains the stability of corporate governance.However,because it violates the principle of equality,it greatly increases the cost of agency,which may result in abuse of authority by authorities and damage to minority shareholders'rights.In view of the above effects,this paper puts forward relevant suggestions from the internal governance of the company and the introduction of the dual ownership structure by the state.