Analysis Of Motivation And Economic Consequences Of Controlling Shareholders' Equity Pledge Financing

Equity pledge as an efficient and convenient financing method,in reality,the behavior of obtaining funds through equity pledge is also becoming more and more common.However,on the whole,the development of China's equity pledge is relatively backward,and the relevant legal regulations are not very perfect.Therefore,various problems have begun to emerge in the practice of equity pledge,among which the controlling shareholder's equity pledge behavior The problems caused are most prominent.Under normal circumstances,equity is the private property owned by the controlling shareholder,so choosing equity pledge as a financing channel is also the personal behavior of the controlling shareholder.However,in fact,the controlling shareholder's equity pledge behavior affects not only the individual,but also It will affect the entire company,including other stakeholders.This article analyzes the motives of equity pledge financing of Guirenniao's controlling shareholders as its background,and analyzes the motives of its equity pledge financing and the impact on various parties involved.First,the research background and significance are explained,and the relevant literatures of domestic and foreign scholars are reviewed and commented.Secondly,related concepts including theoretical basis are introduced,and the analysis is mainly from two perspectives of institutional background Overview of China's equity pledge;then,it mainly analyzes the motives and economic consequences of the pledge of noble bird equity.In the case analysis process,in addition to a detailed analysis of the motives and influencing factors of the controlling shareholder's equity pledge,the economic consequences of the company,small and medium shareholders,and pledge creditors are also analyzed from different perspectives.The main conclusions drawn from the analysis include:(1)Frequent and high proportion of equity pledges by controlling shareholders will cause their cash flow rights and control rights to be severely separated,which will eventually lead to agency problems and cause the controlling shareholders to use equity pledges to cash out.Big.(2)From a short-term perspective,the frequent large share pledge of controlling shareholders will cause abnormal fluctuations in the company's stock price;from a long-term perspective,when the pledge ratio reaches a higher value,it will lead to the operation of the capital market for listed companies Holding a negative attitude will eventually have a negative impact on the majority of small and medium shareholders and pledge creditors.(3)In order to evaluatethe value of the company,this article sorts out the Tobin Q value of Noble Bird from 2014 to 2019.After research,it was found that the corporate value of Noble Bird continued to drop sharply after its controlling shareholders began to frequently pledge equity.This phenomenon further confirmed that the high-frequency equity pledge behavior of the controlling shareholders will have a great negative effect on the company's value.influences.Finally,in view of the problems in the case of noble bird equity pledge,relevant suggestions are given from the listed company itself,stakeholders and external supervision,hoping to bring some enlightenment to the equity pledge behavior of China's controlling shareholders,and then Promoting the healthy and sustainable development of China's capital market and listed companies has a positive impact.