Corporate Financialization,Internal And External Governance And Debt Financing

Under the background of China’s economic structural imbalance gradually prominent,real enterprises are generally facing weak operation and market supply and demand imbalance,and the gap between the return on investment of real enterprises and the financial industry is widening.Attracted by the high returns of the financial and real estate industries,more and more real enterprises use more funds to allocate financial assets,relying more on the financial market rather than physical production to obtain income.As one of the ways to alleviate financing difficulties and diversify risks,moderate financial investment can promote the sustainable development of real enterprises.However,if an enterprise invests a large amount of financial assets out of the motive of market profit,it will have a "crowding out effect" on the main business development and innovation investment of the enterprise,and at the same time transmit financial market risks to the enterprise,resulting in the expansion of the enterprise’s risk,which may affect the enterprise’s ability to perform debts.Whether the financialization of real enterprises will affect the decision-making of corporate creditors,and then affect the cost and scale of obtaining debt financing for enterprises,is a question worthy of in-depth discussion.From the perspective of creditors,this paper links the financial asset allocation behavior with enterprises’ acquisition of debt financing,and discusses the impact of corporate financialization on the cost,scale and nature structure of corporate debt financing.Based on the definition of relevant concepts,this study puts forward research hypotheses based on information asymmetry,principal-agent theory and risk premium theory.Empirical research was conducted on China’s A-share listed non-financial enterprises from 2011 to 2021.Firstly,the impact of the degree of financialization of enterprises on the cost,scale and nature structure of corporate debt financing is analyzed from the whole sample level.Secondly,the heterogeneous impact of holding different types of financial assets on obtaining debt financing is examined.Thirdly,in order to study the regulating effect of internal and external governance,two regulating variables of institutional investor shareholding ratio and internal control quality are introduced,and their impact on the relationship between corporate financialization and debt financing is examined.In addition,in order to solve the problems of possible missing variables,this paper uses the construction of first-order lag terms as instrumental variables,propensity score matching and replacement variable measures for robustness testing.Finally,conclusions are drawn based on empirical results,and suggestions are made from the perspectives of enterprises,governments,and creditors.The results of this paper show that the higher the degree of financialization of enterprises,the higher the cost of debt financing,the lower the scale of new loan financing,and the lower the proportion of credit loans,that is,the financialization of enterprises will have a negative impact on enterprises’ access to debt financing.When the quality of internal control of enterprises is higher and the shareholding ratio of institutional investors is higher,the positive correlation between financialization and debt financing costs is weaker,and the negative correlation with the scale of new loans and the proportion of credit loans is weaker,indicating that good internal and external governance of enterprises can reduce the negative impact of financialization.This article suggests that enterprises should appropriately allocate financial assets and attach importance to the development of their main business;Creditors should fully consider the trend of financialization of enterprises,formulate and optimize debt contracts with the times,and force enterprises to pay attention to the appropriateness of financial investment and risk management;Government departments should improve policies and systems,maintain the vitality of the real economy,and guide enterprises to better develop their main businesses.