The Impact Of Holding Shareholder Pledge On Company Value

Listed companies in China,especially private companies,have always been faced with the problem of high financing constraints.The initiation of equity pledge,a new financing method,provides a convenient and efficient financing channel for listed companies with financing difficulties.When the controlling shareholders use equity as the subject matter of pledge for financing,they still retain the control right of the company,which can better avoid the risk caused by the transfer of control right?However,with the continuous expansion of the scale of equity pledge in the market,the risks associated with equity pledge have attracted more and more attention of scholars.These risks are mainly caused by the high separation of control right and cash flow right.Due to the separation of controlling rights and cash flow rights of controlling shareholders,the second kind of agency problem between controlling shareholders and small and medium shareholders arises,which makes the controlling shareholders'motivation to damage the interests of small and medium shareholders and encroach on the resources of listed companies stronger.The influence of controlling shareholders on listed companies is very important,and their decision-making is very important to the company's operation and development.Therefore,the impact of controlling shareholders' conduct and equity pledge on the company's value is more worthy of our study.First of all,this paper read and combed the relevant literature of equity pledge at home and abroad.Most scholars believe that the controlling shareholders can really solve the financing constraints of enterprises,meet the financing needs of enterprises,and promote the operation and development of enterprises.However,the frequent and high proportion of stock pledge will aggravate the separation of control right and cash flow right,which will lead to the second kind of agency problem.At this time,the controlling shareholders may choose to occupy the interests of small and medium shareholders to meet the pursuit of private interests,and even the behavior of hollowing out the listed company will cause serious harm to the value of the listed company.In addition,the behavior of the controlling shareholders' equity pledge shows that the listed companies have serious problems of insufficient funds,and transmit the signals of bad business operation to other investors in the market,which makes the other financing methods besides the equity pledge more limited and the financing constraints facing the companies more serious.It not only studies the impact of controlling shareholders' equity pledge on the value of the company in the end,but also further discusses the different nature of property rights,the concentration of equity and the regional differences in this impact Use.In this paper,all listed companies of A-share controlling shareholders in Shanghai and Shenzhen are taken as the research objects,and relevant data are obtained from guotai'an database and wind database.Excel and Stata 14.0 are selected to process and analyze the relevant data.Finally,the conclusion of this paper is drawn through the analysis of the empirical results.The results show that:(1)the value of the company decreases significantly with the increase of the share pledge rate of the controlling shareholders;(2)the negative impact of the share pledge on the non-state-owned enterprises is higher than that on the state-owned enterprises;(3)the negative impact of the share pledge on the value of the company by the controlling shareholders of the listed companies with concentrated shares is less than that of the listed companies with decentralized shares;(4)the negative impact of the share pledge on the value of the company by the controlling shareholders of the listed companies in the eastern region The negative effect of shareholders' equity pledge on company value is higher than that of central and western regions.Finally,according to the conclusion of the study,some suggestions are put forward to the listed companies and relevant supervision institutions,which can provide reference for the companies to avoid the risk of equity pledge and improve the value of the company,and provide some inspiration for the future research on equity pledge.