Ownership Characteristics, Diversification Strategy and Firm Performance of Entrepreneurial Enterprises

Abstract

In this paper, it combined the characteristics of Chinese entrepreneurial enterprises and took130 listing corporations in the growth enterprise market (GEM) as samples. This paper carried out empirical analysis and interpretation on the relationship among the ownership characteristics, diversification strategy and firm performance of the entrepreneurial enterprises. The study found that: in the entrepreneurial enterprises, the diversification strategy are positively correlated with the firm performance, the higher diversification level, the more significant firm performance improvement, the proportion of state shares, legal person shares and individual shares is negatively related with the firm performance, and if each proportion being too high it will hinder the improvement of firm performance, which means keeping a appropriate proportion of the three will enhance the firm performance, the proportion of legal person shares are positively related with the diversification strategy, and it will help implement the diversification strategy by improving the proportion of the legal person shares. In this paper, we constructed a theoretical model of ownership characteristics, diversification strategy and firm performance. And we also put forward corresponding countermeasures to the ownership optimization problems in the Chinese GEM based on this.