Under the background of China's weak economic growth and economic recession in Europe and the United States, Chinese enterprises are facing governance transformation. With the gradual implementation of the national "Twelfth Five-Year Plan" strategic plan and the evolution of agency conflicts between different stakeholders in the corporate governance mechanism, the capital investment efficiency of state-owned enterprises as the pillar of the national economy has become the core issue of deepening the reform of the property rights system of state-owned enterprises under the background of governance transformation. The overall requirement for deepening the reform of the property rights system of state-owned enterprises is that it is necessary to "highlight the capital attributes of state-owned enterprises, guide enterprises to enhance their value creation capabilities and risk control capabilities", and "highlight the main business, which is conducive to improving the core competitiveness of enterprises". In this regard, the question that this book will focus on is: What are the factors affecting the capital investment efficiency of state-owned enterprises? How are they affected? How to improve the efficiency of capital investment of state-owned enterprises in the governance transition economy, and promote the enhancement of value creation, risk control and sustainable growth of state-owned enterprises? The solution to these problems is in line with the strategic orientation of the national "Twelfth Five-Year Plan" on the optimal allocation of state-owned capital and the policy orientation of the State-owned Assets Supervision and Administration Commission on investment supervision and central enterprise assessment, which is the practical significance of this book. The issue of strategic management and control of capital investment of state-owned enterprises involves two aspects: (1) From the perspective of strategic management, the assets formed after capital investment as the carrier of enterprise strategy implementation, and their basic structure must be consistent with the development strategy of the enterprise. (2) As the main financial decision to purchase and form various resources and assets of enterprises, capital investment is not only to the point from the perspective of capital investment, but also provides a new perspective for further exploring the influence mechanism between governance model, management control and enterprise performance. A widely accepted view on explaining the inefficient investment of state-owned enterprises is the theory of property rights reform based on the principal-agent theory, and the existing literature on this area undoubtedly lays an important foundation for the focus topic of capital investment control of state-owned enterprises. However, these documents do not have a comprehensive and in-depth grasp of the institutional background of China's governance transformation, the government intervention factors of inefficient investment of state-owned enterprises, the characteristics of collectivized state-owned enterprises, the connotation of contracts, and the management defects, and cannot provide a complete interpretation framework for the efficiency of capital investment. In the long run, whether it is to solve the problem of macro-allocation efficiency of state-owned assets or the micro-allocation efficiency of state-owned enterprise resources, it is necessary to combine the institutional background of China's governance transformation, use institutional theory and strategic management theory to control the entire overall situation of capital investment control of state-owned enterprises, and deeply explore the composition and operation mechanism of the strategic management and control system of capital investment of state-owned enterprises. Otherwise, it is difficult to make a scientific and reasonable analysis of how to improve the capital investment efficiency of state-owned enterprises. The contents discussed in this book include: (1) Research on the impact of the contractual characteristics of state-owned enterprises on the efficiency of capital investment. On the basis of comprehensively reviewing the reform of property rights of state-owned enterprises, analyzing the contractual characteristics of state-owned enterprises and interpreting the scientific connotation of contract-based capital investment efficiency, this paper analyzes the influence mechanism of contractual characteristics of state-owned enterprises on capital investment efficiency. (2) Construction and operation mechanism of strategic financial control system for capital investment of state-owned enterprises. Build an independent strategic financial control system for capital investment of state-owned enterprises with state-owned enterprises as the core subject, the National Development and Reform Commission, relevant ministries and commissions, the State-owned Assets Supervision and Administration Commission and the Ministry of Finance as auxiliary subjects, government control, corporate governance control and management control as the means, and evaluation control, budget control, incentive control and other subsystems as the center, and on the basis of analyzing the scope contained in each subsystem and the interaction relationship between each subsystem. The mechanism and operation mode of the independent strategic financial control system of capital investment of state-owned enterprises were deeply explored. (3) Analysis of the relationship to be handled by the strategic financial control of capital investment of state-owned enterprises. Through the empirical research methods and case study methods combining qualitative and quantitative, the contractual factors and risk factors of the capital investment efficiency of state-owned enterprises are sought, the influence of different factors on the capital investment efficiency of state-owned enterprises is examined, and the relationship between risk management, value creation and sustainable growth and capital investment efficiency is further explored. (4) Analysis of the mechanism of government regulation on the strategic financial control of state-owned enterprises. Government regulation, mainly the regulation of executive compensation, is considered to be an important means to solve the capital investment efficiency of state-owned enterprises. This book will deeply explore the mechanism of government regulation on the capital investment of state-owned enterprises, and analyze the efficiency of different government regulatory measures and the differences in the impact of different types and regions of state-owned enterprises through empirical research. (5) Design of systematic policies and countermeasures for strategic financial control to improve the efficiency of capital investment in state-owned enterprises. Starting from how to build an independent strategic financial control system for capital investment of state-owned enterprises, this paper provides systematic policy and countermeasure design for promoting the improvement of capital investment efficiency of state-owned enterprises through government control, governance control and management control. (6) Aiming at the needs of business model innovation of large state-owned enterprise groups and the complexity of management control, the role of governance transformation in the business model innovation of state-owned enterprises is emphasized, and then a double-matching governance mechanism is proposed from the dual perspectives of property rights and strategy, and a hierarchical and categorical governance idea that conforms to the characteristics of state-owned assets is proposed, and the management and control of large-scale diversified state-owned enterprise groups are implemented from the two dimensions of industry and control mode. The chapters of this book are as follows: firstly, from the perspective of strategic management control, the problem of improving the efficiency of capital investment in state-owned enterprises is studied as the starting point, and by collecting normative analysis conclusions and empirical evidence of the influencing factors of non-efficient investment of state-owned enterprises, the core of the problem is oriented to the effective strategic management control mechanism of capital investment efficiency of state-owned enterprises. Next, starting from the development process of the governance transformation of state-owned enterprises in China, the second chapter analyzes the institutional factors affecting the capital investment efficiency of state-owned enterprises, and summarizes the main perspectives that currently study the influencing factors of capital investment efficiency of state-owned enterprises, namely governance view and strategic management view. Chapter 2, Institutional Change and the View of Non-Productive Investment, forms the theoretical basis of this book. As the pillar of the national economy, the capital investment efficiency of state-owned enterprises is the core issue of deepening the reform of the property rights system of state-owned enterprises under the background of governance transformation. As the most direct interest of the government, state-owned property rights and the government, as an agency of the state, have an impact on the capital investment efficiency of state-owned enterprises cannot be ignored. Chapter 3 explores how the "supportive" hand and "plundering" behavior of government intervention affect the investment efficiency of state-owned capital from the perspective of the relationship between government and enterprises during the transition period. Under the economic evaluation mechanism, the government's social goals and officials' personal interests become the main motivations for their intervention in state-owned enterprises. Major shareholder holding and political connections have become the main ways for the government to establish ties and intervene with state-owned enterprises. In contrast, government subsidies are a direct economic behavior of the government, which can directly affect the financial status and operating results of state-owned enterprises. Under different circumstances, government subsidies have different impacts on the behavior pattern choices of state-owned enterprises. Finally, we analyze the ways to mitigate inappropriate government intervention from two perspectives: internal governance and external mechanisms. Is government intervention a neutral tactic, or is it "support" or "plunder" of businesses? Chapter 4 takes a sample of 636 listed state-owned enterprises from 2007 to 2011 as a sample to conduct a more detailed study of government intervention and inefficient investment by state-owned enterprises. This paper empirically analyzes the motivation of government intervention from three perspectives: government level, regional differences, and corporate policy burden. At the same time, this chapter examines the economic effects of government subsidies as a direct means of economic intervention in the context of firms' investment opportunities and adds them to empirical models. It was found that the greater the incentive for government intervention, the greater the degree of inefficient investment in state-owned enterprises. Government subsidies, on the one hand, have a "support" effect, which can alleviate the lack of investment of enterprises; On the other hand, in state-owned enterprises with poor investment opportunities, enterprises with subsidies have a more serious overinvestment. This not only illustrates the government's "hand of support", but also provides more evidence of the "hand of predation". Chapter 5 takes the state-owned listed companies affiliated with enterprise groups in Shanghai and Shenzhen from 2011 to 2013 as a sample, and explores the impact of group model operation on the investment and investment efficiency of member enterprises from three aspects: the "interaction" of cash flow among member enterprises within the group, the degree of diversification at the group level and the pyramid structure of the group member enterprises. It is found that the investment level of a member enterprise is highly correlated with its own cash flow level, but the correlation with the cash flow level of other member enterprises is weak. The degree of diversification is significantly positively correlated with overinvestment, and the diversification expansion at the group level aggravates the level of overinvestment of its member companies; The pyramid level is significantly negatively correlated with excessive investment, indicating that the pyramid level formed by the control of enterprise groups can inhibit the occurrence of excessive investment. Neither the level of diversification nor the pyramid level had a significant effect on underinvestment. From the perspective of enterprise groups, the research on the influencing factors of investment efficiency enriches the research of enterprise groups in emerging markets and provides policy enlightenment for deepening the reform of state-owned enterprises. Chapter 6 uses the information disclosed in the financial statements and notes of China's state-owned listed companies from 2007 to 2011 to study the relationship between management power, on-the-job consumption and the investment efficiency of enterprises in state-owned enterprises. The results show that management power and on-the-job consumption are positively correlated, and the level of on-the-job consumption is significantly higher in state-owned enterprises with greater management power. The management power of state-owned enterprises is positively correlated with overinvestment and negatively correlated with underinvestment; Distinguishing the control of enterprises, it is found that the degree of overinvestment caused by the power of managers of central enterprises is lower than that of other state-owned enterprises, and the degree of overinvestment caused by the power of managers of state-owned enterprises controlled by local governments is significantly higher than that of other state-owned enterprises. On-the-job consumption in state-owned enterprises is positively correlated with excessive investment; On-the-job consumption in central SOEs leads to a lower degree of overinvestment than other SOEs, and this chapter does not find that on-the-job consumption in local government-controlled SOEs leads to more serious overinvestment. Finally, the relationship between on-the-job consumption and underinvestment is further examined, and it is found that on-the-job consumption has a certain positive impact on curbing the degree of underinvestment, and the increase of on-the-job consumption can reduce the degree of underinvestment of state-owned enterprises, and the higher the free cash flow of enterprises, the more in-service consumption helps to reduce the degree of underinvestment of enterprises. Chapter 7 starts from the two main perspectives of the influencing factors of capital investment efficiency of state-owned enterprises, and on the basis of considering the background of China's governance transformation and the unique contractual factors and management defects of state-owned enterprises, attempts to build an effective strategic control mechanism for capital investment of state-owned enterprises, so as to achieve the purpose of grasping capital investment opportunities from strategic planning and improving the level of investment returns and risk control capabilities from the perspective of strategy implementation. As an important modern enterprise management method, comprehensive budget management has the functions of planning, coordination, control, incentive and evaluation, and has been widely used in China's state-owned enterprises. AVIC International has also built a relatively complete comprehensive budget system in form, but in practice, comprehensive budget management still exposes many problems such as insufficient detailed indicators, lack of guidance in implementation, and insufficient budget evaluation system, and the budget management system needs to be further improved. Finally, this chapter analyzes in detail the main problems and countermeasures of AVIC International Group's budget organization system, budget preparation, budget analysis and control, and budget evaluation, in order to provide some useful inspiration for improving the budget control function of state-owned enterprise groups. It should be pointed out that with the deepening of research and the further advancement of state-owned enterprise reform, as well as a deeper understanding of the efficiency of state-owned capital investment from the perspective of governance transformation, more practical problems that keep pace with the times have been discovered. The 2013 Central Economic Work Conference pointed out that business model innovation is one of the fundamental solutions to overcapacity. Therefore, in order to resolve overcapacity, tap the growth potential of state-owned enterprises and promote sustainable economic growth, innovative business models have become the direction of a new round of reform of large state-owned enterprises. However, as an advanced form of development of enterprise organizations, China's large state-owned enterprise groups restrict the adjustment of business structure due to the current situation of ambiguous property rights relations, complex organizational structure, diversified operation and even transnational operation, and the innovation of business models is obviously insufficient. Although state-owned enterprises in the transition period have many governance and management deficiencies, which restrict the progress of reform. At the same time, whether large state-owned enterprise groups, which are the pillars of the national economy, can "serve the national strategic goals", promote business model innovation and economic transformation through governance transformation have become key issues that need to be solved at present. The results of further reflection on this issue are reflected in chapter VIII. We believe that business model innovation has become the direction of a new round of SOE reform, and governance transformation is an important path for large SOE groups to achieve business model innovation. What kind of governance model is conducive to the business model innovation of large SOE groups? How to balance the relationship between property rights and strategy and clarify the governance thinking of large state-owned enterprise groups? How to build an effective governance model to achieve strategic value? To this end, Chapter 8 first analyzes the driving force role of governance transformation in the business model innovation of state-owned enterprises. Secondly, it proposes to build a double-matching governance mechanism from the dual perspectives of property rights and strategy, that is, it is not only necessary to strengthen control and create value from the operational level, but also to grasp the strategic opportunities and values that adapt to the changes in the economic situation from the governance level; Thirdly, the idea of hierarchical and categorical governance in line with the characteristics of state-owned assets is proposed, that is, hierarchical governance is adopted for groups or individual subsidiaries, and classified governance is adopted for many descendants and grandchildren. Finally, according to the idea of dividing property rights and strategy, specific and feasible ideas are put forward for diversified operation, multi-legal person and multi-level enterprise groups, that is, on the basis of the implied property rights relationship, the management and control of large-scale diversified state-owned enterprise groups are implemented from the two dimensions of industry and control mode. In particular, the combination of strategy and governance is an effective way for large state-owned enterprise groups to improve investment efficiency. A property rights protection-oriented governance structure should meet the needs of the strategy, but in reality, the strategy may be limited by the governance structure. Whether the enterprise strategy meets the needs of the governance structure and whether the enterprise management control mode matches the governance structure and strategy are the real reasons for the value creation and sustainable development of large state-owned enterprise groups. Therefore, large state-owned enterprise groups can pursue shareholder value and enterprise value at the business unit investment level, and build strategic value at the group level. In this way, by establishing a governance mechanism that matches property rights and strategy, large state-owned enterprise groups can strengthen control and create value from the operational level on the one hand, and grasp the strategic opportunities and value that adapt to changes in the economic situation from the governance level on the other hand. The main points of this book are: (1) The inefficiency of capital investment caused by the unique contractual factors of state-owned enterprises is the "bottleneck" to achieve the goal of preserving and increasing the value of state-owned capital, and building a strategic financial control system is the key to making state-owned enterprises "highlight their main business to help improve their core competitiveness and sustainable development". (2) The controlling entity divided according to the macro and micro perspectives defines the rights, responsibilities and benefit orientation of the relevant parties in the process of state-owned capital allocation. The Development and Reform Commission provides strategic goal guidance for the optimal allocation of state-owned capital for state-owned capital investment, and the State-owned Assets Supervision and Administration Commission provides investment supervision and performance assessment for state-owned enterprise capital investment. The Ministry of Finance provides behavioral guidance and norms for those involved in capital investment in state-owned enterprises. The National Development and Reform Commission, the State-owned Assets Supervision and Administration Commission and the Ministry of Finance are the "pressure parties" to exert strategic financial control over the capital investment of state-owned enterprises, and the state-owned enterprises themselves are the "active parties" of the strategic financial control of capital investment. (3) Capital investment control is strategic, balanced and whole-process, and must start from the path of financial performance, value creation and corporate strategy. Relationships to be handled by strategic financial control: managing growth from a financial strategic perspective; From the perspective of value creation, pursue returns; Risk management from a financial performance perspective. (4) The strategic financial control model should include system control (belonging to rule control), budget control (belonging to process control), evaluation control (belonging to target control) and incentive control (belonging to interest control). (5) In order to build a strategic financial control system for capital investment of state-owned enterprises, it is necessary to stand at a strategic height, because the company's strategy determines the direction of capital investment decisions, capital investment is the fundamental way to achieve strategic planning, and strategic implementation needs to transform strategy into the enterprise value creation level recognized by stakeholders as operable, so that the enterprise organizational process and strategy are coordinated, the strategy is transformed into a systematic process, and implemented in every link of the implementation of capital investment projects (budget control - belongs to process control), Incentives and constraints (incentive control - interest control) according to financial performance appraisal (evaluation control - belongs to target control, lack of process control). (6) The construction of a strategic financial control system for capital investment of state-owned enterprises should be based on China's national conditions, should not blindly copy the experience of other countries, and should establish a systematic policy system to ensure its operational efficiency. This book provides useful thinking and exploration on the above issues, and forms preliminary research results and personal views on the strategic control mechanism of inefficient investment of state-owned enterprises from the perspective of governance transformation, and its academic value and social impact need to be further observed. I sincerely hope that readers will put forward valuable opinions so that the research on the strategic control of inefficient investment in state-owned enterprises can be further deepened. This book is funded and published by the Dalian Municipal People's Government.（AI翻译）