Non-Financial Stakeholders,Environmental Uncertainty And Firms' Capital Structure

With the deepening of supply-side structural reform in China,the adjustment of"deleveraging" has achieved remarkable results,however,the slowing down of macroeconomic growth has caused the shifts of central policy."Stabilizing leverage"has become an urgent task to maintain macroeconomic stability at current stage.In order to choose a reasonable leverage ratio to achieve the balance between economic growth and financial risk,the capital structure of enterprises has attracted strong attention again.At this very era of knowledge economy,tangible material capital is no longer a scarce resource for the growth of enterprise value,and non-financial stakeholders,as the owners of intellectual capital,make more and more contributions to the growth of enterprise value.Although non-financial stakeholders,including customers,suppliers and employees,cannot directly participate in decision or strategy making,the interests of these non-financial stakeholders have become the content that enterprises should consider and pay attention to when making financial decisions.Previous studies have mostly focused on the relationship between shareholders,creditors,management and enterprise capital structure,while ignoring the impact of non-financial stakeholders on enterprise capital structure decision-making.In this paper,the non-financial stakeholders are well considered in the research scope of the factors affecting the capital structure of enterprises,which can not only help enterprises to choose a reasonable capital structure,but also arouse the attention of enterprises to the non-financial stakeholders,implicit contract claiming rights,and helping protect the rights and interests of non-financial stakeholders.In addition,the uncertainties of enterptrises' environment are increasing due to the changing macroeconomic policies and unpredictable behavior of stakeholders such as customers,suppliers and employees.The intricate internal and external environmental factors bring risks to the strategic planning and future operation of enterprises,and also lead to a large fluctuation of business performance.Non-financial stakeholders,as an important part of the environment in which enterprises live,are also important factors to be considered when making financial decisions.Therefore,the study of the impact of non-financial stakeholders on the capital structure of enterprises under different degrees of environmental uncertainty can help enterprises cope with the impact of environmcntal uncertainty and make reasonable financing decisions.Based on the reasons mentioned above,this paper,starting from stakeholder financial theory and contract theory,regards capital structure as the claiming structure of financing contract between enterprises and stakeholders,investigates the relationship between non-financial stakeholders and capital structure decision-making of enterprises,which provides a new perspective for the related research of determinants of capital structure of enterprises,and also enlarges the benefits.Secondly,from the perspective of game and bargaining between non-financial stakeholders and enterprises,this paper analyses the impact of non-financial stakeholders' bargaining power on the capital structure of enterprises,whether Chinese listed companies will be affected by non-financial stakeholders such as suppliers,customers and employees when making capital structure decisions or not.Finally,this paper further tests the moderating effect of environmental uncertainty on the relationship between non-financial stakeholders and enterprise capital structure,explains whether enterprises will use debt as a means to enhance bargaining power under different environmental uncertainties,and provides new empirical evidence for the impact of uncertainty on enterprise financial decision-making.This paper chooses the sample data of Listed Companies in China from 2013 to 2017 to make a regression analysis of the relationship between non-financial stakeholders and the capital structure of enterprises,and further tests the impact of environmental uncertainty on the relationship between non-financial stakeholders'bargaining power and the capital structure of enterprises.The results show that the bargaining power of non-financial stakeholders is significantly related to the capital structure of enterprises.Although they are both non-financial stakeholders of enterprises,the bargaining power of three types of non-financial stakeholders,namely customers,suppliers and employees,has different effects on the capital structure of enterprises.Customer bargaining power and supplier bargaining power have significant positive effects on enterprise capital structure,while employee bargaining power has significant negative effects on enterprise capital structure.The reason is that when the bargaining power of customers or suppliers increases,Chinese listed companies tend to increase their bargaining power by increasing debt to pressure customers or suppliers,and when the bargaining power of employees increases,Chinese listed companies tend to reduce the risk of bankruptcy by reducing debt and convey confidence in the future of enterprises to employees,so as to avoid the loss of employees.In further testing,we find that environmental uncertainty has a significant moderating effect on the relationship between bargaining power of non-financial stakeholders and capital structure of enterprises.Specifically,the high degree of environmental uncertainty aggravates the positive impact of customer bargaining power and supplier bargaining power on enterprise capital structure,and weakens the negative impact of employee bargaining power on enterprise capital structure.This shows that the growth of environmental uncertainty strengthens the tendency of enterprises to use high debt level as their bargaining chip,and weakens the motivation of enterprises to use low debt level as a good signal for future operation.