Research On The Reduction Behavior Of Major Shareholders From The Perspective Of Protection Of Minority Shareholders’ Rights And Interests

After the end of the split share reform,China’s capital market has entered a fully tradable era.After the lifting of the ban on restricted shares,major shareholders can obtain wealth in the stock market by selling their own shares.Although the act of reducing holdings is understandable,major shareholders often use their information advantages to manipulate stock prices to achieve high level reduction if they want to obtain higher reduction returns.Compared to major shareholders,minority shareholders are at a disadvantage in terms of information.Therefore,in this process,information asymmetry often exists,which not only infringes on the legal rights and interests of minority shareholders,but also damages their economic interests.In recent years,incidents of disorderly reduction of major shareholders causing damage to the rights and interests of minority shareholders have occurred frequently.How to better protect the rights and interests of minority shareholders in the process of major shareholders reduction has become an urgent problem to be solved.This article studies the reduction behavior of major shareholders from the perspective of protecting the rights and interests of minority shareholders,analyzes the impact of the reduction behavior of major shareholders on the rights and interests of minority shareholders,and proposes internal and external governance strategies for the reduction behavior of major shareholders.The research in this article is not only beneficial for safeguarding the rights and interests of minority shareholders,but also for regulating the reduction of holdings by major shareholders of listed companies,and maintaining the fair and stable operation of the market.This article adopts literature research and case study methods,with the reduction behavior of the Wu family,a major shareholder of 37 Interactive Entertainment Company,as the research object.Firstly,it introduces the cases of major shareholder reduction,and then conducts case analysis,including the reasons for major shareholder reduction,operational methods,and the impact on the rights and interests of minority shareholders.When studying the impact of major shareholder reduction on the rights and interests of minority shareholders,three impact paths were divided from the perspectives of legal rights and economic interests.The mechanism of the impact of major shareholder reduction on the rights and interests of minority shareholders in each path was analyzed,and based on this,the specific consequences of the impact on the rights and interests of minority shareholders in each path were analyzed.Firstly,at the level of legal rights and interests,combined with the means of reducing the holdings of major shareholders,analyze which specific legal rights and interests of minority shareholders have been infringed upon by major shareholders during the reduction process;Secondly,when studying the impact of the reduction of large shareholders on the economic interests of minority shareholders,the event study method and financial index analysis method are used to analyze the stock price effect and financial effect caused by the reduction of large shareholders,and on this basis,further combining the various means and characteristics of large shareholders to analyze the consequences of the reduction of large shareholders on the economic interests of minority shareholders.By studying the impact of major shareholder reduction on the legal rights and economic interests of minority shareholders,we aim to identify the inadequacies of major shareholders in the reduction process,summarize case insights,and provide direction for regulating and constraining the reduction behavior of major shareholders.Through the analysis of the entire case,the main findings of this article are as follows: the main motivation for the major shareholders of 37 Interactive Entertainment Company to reduce their holdings is to cash out and obtain huge profits;Driven by this self-interest motivation,major shareholders have adopted various means to obtain higher returns through stock reduction,including pushing up stock prices,providing cover for reduction,and illegal reduction;These measures not only infringe on the legal rights and interests of minority shareholders,but also harm their economic interests;This also proves that there are imperfections in China’s regulatory laws and policies regarding the reduction of major shareholders,which allows major shareholders to infringe on the rights and interests of minority shareholders during the reduction process.Therefore,this article hopes to propose governance measures for the reduction of major shareholders from different levels,in order to regulate and constrain the reduction behavior of major shareholders,and thus better protect the rights and interests of minority shareholders in the process of major shareholder reduction.