The Impact Of Dual-Class Share Structure On Enterprise Performance

In recent years,many high-tech enterprises in China have adopted different ownership structure of the same shares to list overseas,such as Baidu,Jingdong and so on.In 2014,Alibaba,one of China's Internet giants,was rejected by the Hong Kong market because of its adherence to the partnership system and turned to the U.S.capital market and created the largest IPO in U.S.history.In order not to repeat the Alibaba Incident,after a long period of full consideration,in April 2018 the Stock Exchange of Hong Kong finally announced that it would accept dual equity structure enterprises to go public in Hong Kong.Since Alibaba went to the U.S.for listing,the general manager of Shenzhen Stock Exchange has proposed to reserve some space for the dual ownership structure in the system design of technology-based enterprises,which shows that the traditional structure of the same share and the same right can no longer meet the needs of corporate governance and the rapid development of high-tech enterprises.In 2019,China's Kechuang Stock Exchange will be set up in Shanghai Stock Exchange.The different rights stock system is also one of the issues discussed.At the same time,the international capital market has been very different about the ownership structure,so the dual ownership structure has great research value.This paper takes Alibaba Group and Tencent Holding Group as the research objects,and makes a comparative study of their performance in order to provide some reference for the internal governance of emerging enterprises,the acceptance of dual ownership structure in China's capital market and the formulation of relevant laws and regulations.The conclusions of this study are as follows:(1)The dual ownership structure makes the founder and his team have stable control over the company through institutional arrangements,which is conducive to reducing agency costs and promoting enterprises to pay more attention to longterm development.(2)Dual ownership structure of enterprises for long-term development as the goal,will reduce the use of financial leverage and easy to overinvestment,which will have a negative impact on the short-term performance of enterprises.The main contribution of this paper lies in the use of comparative cases.Previous studies on dual ownership structure mainly use empirical and single case studies.This paper adopts dual case comparative study,which can better explore the impact of ownership structure on corporate performance in case companies.It can also verify the practicability of empirical results and enrich the relevant research literature.The disadvantage of this paper lies in the particularity of the selected cases and the conclusion may not be universal.At the same time,there are many factors affecting enterprise performance,but due to the limited time and accessibility of information,not all factors except ownership structure are controlled,so the accuracy of the conclusion needs to be further verified.