Related-party Transaction,Equity Checks And Balances And The Over-investment

As one of the basic activities of financial management,investment activities are not only the foundation of enterprise development,but also one of the necessary conditions for enterprises to realize value added.However,in the current market environment,most of China’s enterprises have problems of inefficient investment such as underinvestment or over-investment.These problems not only affect the long-term development of the enterprise itself,but also affect the smooth operation of the entire macro-economy.So what are the factors that affect the company’s non-efficiency investment,and what methods are available to solve this problem,which has always been a key topic for discussion in the academic community.The reason for the company’s over-investment is mainly due to the existence of principal-agent and information asymmetry between the shareholders and the creditors and the managers,and the above-mentioned problems of the internal connected transactions themselves are aggravated and complicated.Degree.In addition,related transactions have alleviated the company’s financing constraints to a certain extent,so it is easier for enterprises to generate excessive investment behavior.This paper selects the non-financial companies of listed companies’ A-shares from2010 to 2016 as the research object.The empirical research finds:(1)The more connected transactions,the higher the degree of over-investment.(2)Listed companies with better equity checks and balances can effectively mitigate the impact of connected transactions on over-investment.(3)In further analysis,it is found that as a substitute indicator of equity checks and balances,when the nature of the first and second major shareholders are different,the equity checks and balances can play a more important role in governance.In addition,increasing the shareholding ratio of institutional investors can effectively reduce the level of excessive investment caused by related party transactions.The innovation of this paper is to analyze the impact of over-investment from the perspective of connected transactions of listed companies,and analyze the impact on the relationship between the two by combining the equity checks and balances mechanism and institutional investors’ holdings and executives’ holdings.The specific content of the thesis includes: the first part of the introduction,mainly expounds the research background,purpose and significance of this paper,introduces the research methods and ideas,and explains the innovation of the thesis;the second part is theoretical analysis and literature review,mainly It is a review of relevant literatures on non-efficiency investments,related transactions,and institutional investors,and combined with economics related theories to provide strong support for the research design and empirical analysis;the third part of the research design,mainly based on the previous The related research of the scholars carries out a series of combing on the main contents of this paper,and puts forward the research hypothesis.Then introduces the selection method and data source of the variables,and constructs the research model for the relevant hypotheses.The fourth part analyzes the empirical results,mainly for the previous papers.The theoretical hypothesis is tested,and the variables are descriptive statistics,correlation analysis and multiple regression analysis,and the results are analyzed in depth.The fifth part is the conclusion and policy suggestion part of the paper,and the above results are summarized.Research analysis Policy proposals put forward insufficient and the future research direction in research methods and ideas at the end.