A Research About The Relation Between Executive Social Capital And Corporate Acquisitions

Since the establishment of China’s securities market in the past 30 years,various financial businesses have been booming,and the number of listed companies has been increasing.Along with this is the frequent occurrence of equity acquisitions in the market,some of which are powerful alliances between high-quality companies,while others are only short-term profit-making in the stock market by entrepreneurs using the convenience provided by their own social capital.However,as there are still huge loopholes in the supervision of China’s financial market,the latter has a huge negative impact on the benign development of the capital market.Behind these cases,most of them have a common feature,that is,the executives of their main parties are supported by strong social capital,which brings low-cost financing and related information support for the completion of related acquisitions,which is unmoving.The completion of some insider operations provides guarantees to ensure that enterprises obtain sufficient income.This article is based on real cases,combining theory with practice,starting with the social capital of corporate executives,analyzing the social relationship network behind it,and exploring its impact on corporate acquisitions.The full text first introduces the research background and content,and sorts out the framework.Then combined with the domestic and foreign research results of social capital theory and information asymmetry theory,and the actual situation in the case are assembled,in-depth analysis.Secondly,it introduces the basic operating conditions of both parties of the case selected in this article,makes a detailed analysis of the financial situation of Wanjia Culture,and explains the entire acquisition process and results of the case.Then,combined with the relevant theories of social capital,we analyze the relationship between executive social capital and the source of corporate funds,the impact on corporate information disclosure,and theperformance of corporate securities markets,etc.,and finally draw corresponding conclusions and make recommendations.According to the analysis,the author believes that Longwei’s executive financial social capital helps companies bring low-cost acquisition funds,and high-quality executive financial social capital will have a positive impact on corporate financing.Secondly,the business social capital of senior executives such as Long Wei and Wanjia has promoted illegal cooperation among enterprises,and their existence may cause enterprises to engage in fraud and conduct behaviors that are not conducive to market supervision.Thirdly,Longwei ’s reputation social capital misleads small and medium-sized investors,which makes the market order chaotic,large shareholders benefit,and small shareholders lose,implying that the improper use of reputation social capital by executives will damage the market ’s normal business and trading order.In the end,Longwei ’s acquisition of Wanjia Culture is not based on long-term business.Its main purpose is to make short-term profits in the securities market,and the gold owner behind this acquisition may be the “Tomorrow” group.In summary,this article starts with the special perspective of executive social capital,analyzes its impact on corporate acquisitions,and finally puts forward a series of recommendations,hoping to use this to help economic and social development and protect the legitimate rights and interests of investors to promote the improvement of China’s financial market supervision system and create a new situation in which China’s economy continues to develop in a healthy and sound manner.