The Research on the Impact of Large Shareholders Governance on Corporate Performance

The purpose of this paper is to improve our understanding of the large shareholders governance by checking the shareholding ratio of the largest shareholder on the performance of listed companies. In this paper, a group of 6 861 state-owned and private listed companies from A share market in 2014-2016 are used as research samples, and the regression model is used to analyze the samples. The result shows that the shareholding ratio of the largest shareholder in the state-owned listed company is positively correlated with the company performance. In the private listed company, the relationship between shareholding ratio of the largest shareholder and the company performance is inverted U-shaped curve. The paper increases the research on the large shareholders governance, and proves that the large shareholders governance has different effects on state-owned listed companies and private listed companies. The higher the shareholding ratio of the largest shareholder in the state-owned listed companies, the better of the company's performance; in Chinese private listed firms, large shareholders governance to a certain extent can improve the performance of the company. However, when the shareholding ratio of the largest shareholder reaches a certain level, there might be tunneling behavior, thereby reducing corporate performance.