Empirical Research On The Impact Of Corporate Governance Structure On Goodwill Impairment

After the development of more than 40 years of reform and opening up,China’s social-market economy has a dramatic growth.China has also developed from a poor and backward developing country into a "the world’s second largest economy",gaining more and more speaking right in the in the fierce competition of international market.At the same time,the capital market system,economic system,and corporate governance structure model are also constantly being optimized,especially in terms of corporate governance structure.With the rapid development of a globalized market economy,the continuous of the generation of high and new technologies,more and more enterprises have set their sights on diversified development and the development model of the whole industry chain.The construction of a modern corporate governance system has become a necessity for development.China’s corporate governance structure has also been continuously improved and developed in a series of reforms such as simplified administration and decentralization,and management of capital,forming a three-dimensional mutual restraint management mechanism composed of the shareholders’ meeting,the board of directors,the board of supervisors,and the managers.In recent years,as China’s social development has entered a new era and the economic development model has changed from pursuing high speed to pursuing high-quality development.During the adjustment period of economic structure,the economic growth has slowed down and the corporate performance has declined.At the same time,goodwill impairment events have occurred on a large scale in all major capital market segments,and this growth trend has lasted year by year,which has caused large-scale write-offs of listed company performance profits,and has seriously affected the effective operation of the capital market and hindered the transformation of China’s economy.The impact of the issue of goodwill impairment has involved various industries or sectors,which has caused a huge impact on the stability of the development of the entire capital market.This is no longer explained by a single company or industry.It must exist the problems of the governance structure of China’s listed companies behind it,such as the imbalance of the equity structure,the loss of independence of the board of directors,the lack of powers of the board of supervisors,and the agency problem.This article mainly discusses the impact of corporate governance structure on the impairment of goodwill,clarifies the development status and existing problems of corporate governance structure,and analyzes the path and extent of its impact on the impairment of goodwill.This research is mainly carried out from the four main levels of the corporate governance structure,the equity structure,the board structure,the supervisory board structure,and the manager structure.Relevant data of China’s A-share capital market from 2012 to 2018 are selected to construct a merged regression model(Tobit).Through empirical analysis,the author found that the four main levels of corporate governance structure have a significant impact on the impairment of goodwill.In the equity structure,the increase in the attributes of state-owned enterprise and equity concentration level can significantly reduce the risk of goodwill impairment.In the structure of the board of directors,the expansion of the scale of the board of directors and the increase in the proportion of independent directors will also have a significant effect on reducing the risk of the impairment of goodwill.At the structural level of the board of supervisors,there is a significant negative correlation between the size of the board of supervisors and the impairment of goodwill.However,the impact of the diligence of board of supervisors on the impairment of goodwill is not significant.At the managerial level,becoming both chairman and CEO at same time and the change of the position of general manager will cause an increase in the risk of goodwill impairment,in addition,the expansion of the size of senior executives will reduce the risk of the impairment of goodwill.Furthermore,we analyze the problems contained in the development of China’s corporate governance structure and propose relevant policy recommendations to reduce the risk of goodwill impairment to promote the healthy transformation and development of China’s market economy.