Abstract
ABSTRACT Listed companies with a higher separation of two rights have less risk of control transfer of the ultimate controlling shareholder. The ultimate controlling shareholder’s equity pledge ratio plays a remarkable mediating role in this process. At different pledge rates, the ultimate controlling shareholder’s equity pledge exhibits an ‘encroachment’ or ‘incentive’ effect on corporate governance, respectively, resulting in an inverted U-shaped relationship between equity pledge rate and the risk of control transfer. Company size has a heterogeneous effect on the risk of control transfer, while shareholding concentration has heterogeneous and single threshold impacts on this risk.
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