Advantages:
In a company with decentralized shares, the control right is shared by several major shareholders, which realizes the equity arrangement mode of mutual supervision among major shareholders and makes the company's decision more democratic.
At the same time, through the internal constraints of the board of directors, any major shareholder can make decisions beyond his control, which can effectively restrain the possible infringement of the interests of listed companies by the behavior of "using public interests for personal gain" by major shareholders.
Disadvantages:
The decentralization of decision-making power will lead to the decline of decision-making efficiency, which will make the company unable to respond to market changes in time and miss the development opportunity.
At the same time, shareholders holding too few shares will reduce the interest correlation between the company and shareholders, dampen their enthusiasm for participating in the company's affairs, lead to the decline of their supervision and supervision over the management, and finally lead to the strong control of the company by the management.
In addition, once there is a contradiction between the major shareholders in the board of directors, it is easy to cause contradictions and affect the stable operation of the company.
2. Equity concentration
Advantages:
In a company with concentrated equity, the largest shareholder holds a relatively large share of the company and holds the company's decision, which can greatly improve the efficiency of decision-making.
At the same time, it has a great correlation with the company's interests, and the company's profit and loss will have a great impact on it, so it has great enthusiasm for participating in the company's affairs and is conducive to the good operation of the company.
Disadvantages:
With the concentration of stock rights, the power of major shareholders is not restrained, and the decision-making process lacks democracy, which is prone to decision-making mistakes caused by indecision of decision makers, and even the behavior of major shareholders using their power to infringe on the interests of the company.
Extended data
The reasonable ownership model of the company should be "decentralization" and "centralization", that is, other major shareholders need to ensure the controlling position of the largest shareholder while restraining the largest shareholder, form a balanced ownership structure of multiple major shareholders representing different stakeholders, and ensure the driving force of the company's operation.
Specifically, for the "one-share monopoly" company, on the basis of ensuring the controlling position of the largest shareholder, we should actively guide it to reduce the excessive shareholding ratio or transfer part of its equity to other major shareholders with relatively more shares. In a company with relatively dispersed equity, the equity of the first shareholder should be appropriately increased to improve the decision-making efficiency.
References:
Baidu encyclopedia-equity dispersion
Baidu Encyclopedia-Equity Concentration