Research On The Motivation And Economic Consequences Of Controlling Shareholder’s Equity Pledge

At present,it is in the essential period of the "14th Five Year Plan".The ecological landscape construction industry should shoulder the mission of green and environmental protection.The development of the industry needs sufficient capital reserves to contract engineering projects and drive technological innovation of enterprises,which shows that the problem of difficult and expensive financing of the industry is becoming more and more prominent.Listed companies and controlling shareholders of ecological landscape construction industry are more inclined to use equity pledge financing in order to solve the problem of capital shortage,which is relatively simple and fast.However,excessive and high proportion of equity pledge will bring higher risks to the operation and management of the company,and may even damage the value of the company,which is easy to cause adverse economic consequences.Based on the background of equity pledge of controlling shareholders,this paper uses principal-agent theory,cash flow right and control right theory,information asymmetry theory,and selects ~*ST Ms Eco as a case enterprise,using the relevant information disclosed by the company to study and analyze the motivation and economic consequences of its equity pledge.Firstly,the situation and characteristics of the equity pledge of the controlling shareholder of~*ST Ms Eco is sorted out.Secondly,according to the actual equity pledge situation of the controlling shareholder of the case company,the motivation of equity pledge is deeply analyzed from five aspects.Thirdly,the path and economic consequences of equity pledge are further analyzed.Finally,based on the above analysis,the relevant conclusions and enlightenment are drawn.Research findings: ~*ST Ms Eco equity pledge features include the controlling shareholder equity pledge frequency,high pledge rate,circular pledge,repeated supplementary pledge and frequent repurchase repurchase,pledge announcement information disclosure is not timely.~*ST Ms Eco’s controlling shareholders’ equity pledge motives include meeting financing needs,maintaining controlling shareholders’ control rights,transferring the company’s business risks,avoiding the restriction of restricted shares for sale,implementing profit embezzlement to gain private gains,among which the implementation of profit embezzlement to gain private gains mainly through appropriating the non-operational capital,providing guarantee for related parties,reducing shares and profit arbitrage three ways.And the main influencing paths of the stock pledge are mainly the separation of ownership and control,investment behavior and manipulation of information disclosure.Subsequently,it further reveals the economic consequences of ~*ST Ms Eco’s controlling shareholder equity pledge,which is mainly manifested as worsening short-term market effect,deeping financial difficulties,reducing the overall value of the company and damaging the company’s financial performance.~*ST Ms Eco controlling shareholder equity pledge has certain particularity and representativeness.Studying its causes and economic consequences can reduce the occurrence of equity pledge disorder and promote the perfection and stability of our capital market.