Research On The Relationship Between Diversified Management And Financial Investment In Listed Enterprises

The diversified operation of listed companies refers to the diversification of business operations.It is a strategy for companies to operate multiple different businesses at the same time in a number of related or unrelated industries.At present,many enterprises in China are also in the stage of diversified expansion.Enterprise financial investment is an important channel for corporate fund management.Diversified operations will have an important impact on corporate financial investment decisions:because diversified enterprises have the advantages of reducing business risk,internal financing,and financing constraints,with the efficiency of capital use,the increase in the marginal income of cash holdings will reduce the amount of free cash held within the enterprise;At the same time,enterprises with diversified business strategies may have prominent agency problems.Excessive free cash inside will lead to excessive investment in management.In order to reduce the marginal cost of cash holdings,enterprises will reduce the number of free cash holdings.In view of the above two reasons,diversified enterprises tend not to invest in wealth management products.In addition the severity of the agency problem will be affected by the level of corporate governance and the level of external industry concentration.As China's market environment is still in the process of continuous improvement.The difference between corporate governance level and industry concentration is greater.Therefore,the financial investment decision-making of diversified enterprises may be affected to some extent by differences in corporate governance and industry concentration.Based on information asymmetry and free cash flow theory,this paper comprehensively uses qualitative analysis and quantitative analysis,using all A-share data from 2015 to 2017 as a research sample,and using the two-stage model of Heckman to explore the impact of diversified management on financial investment tendency and investment level.The empirical results show that:(1)diversification are negatively correlated with financial investment tendencies and investment levels.(2)Enterprises with high corporate governance,the inhibition of diversified operations on wealth management investment decisions is more obvious than those with low corporate governance(3)Enterprises with high concentration in the industry,the inhibition of diversified operations on wealth management investment decisions is more obvious than those with low industry concentration.This article gives us the enlightenment: In theory,diversification is an important factor affecting the financial investment decision-making of listed companies.In practice,we should fully grasp the unique capital allocation advantages within diversified business enterprises,actively develop the main business and enhance corporate value.At the same time,strengthen internal control measures for enterprises that invest in wealth management,increase external supervision guidelines,and strictly limit the conditions for enterprises to purchase wealth management products.