How to restrain the tunneling behavior of major shareholders is a focal issue of both academic and practical concerns in corporate governance. The traditional principal-agent framework follows the one-way governance logic of "top-down" parent-subsidiary, ignoring the autonomy of subsidiaries and their "bottom-up" checks and balances, which makes it difficult to solve the problem of protecting the interests of subsidiaries and their minority shareholders fundamentally. Although the one-way governance paradigm has been questioned by scholars, the ways through which subsidiaries can provide checks and balances to the parent company need to be further explored. Based on the viewpoint of prospect theory, this paper uses balanced panel data of Chinese listed subsidiaries from 2012 to 2017, and uses multiple regression method to verify the influence of the heterogeneity of subsidiary executives on tunneling, and explains the realization path, weakening factors and the boundary of the "bottom-up" checks and balances of subsidiaries. The results show that subsidiary executives with strong ability can restrain tunneling significantly. On the one hand, executives with strong ability can bring more shared benefits to the major shareholders, limiting their access to private benefits of control rights. On the other hand, they can identify and supervise tunneling effectively, and then play a "bottom-up" check and balance role for the major shareholders. As situational variables with dual effects, the negative effects of CEO reputation and the CEO connectedness with parent company are more prominent in China, and both of them will weaken the check and balance of managerial ability on tunneling, that is, under the situation that the reputation level of subsidiary CEO is high and the CEO connectedness with parent company is strong, the inhibition effect of subsidiary managerial ability on tunneling is weak. In the expanded research, this paper compares the governance effects of managerial ability under different situational factors by grouping equity concentration and equity balance. The results show that in the samples with low equity concentration and high equity balance, the inhibition effect of subsidiary managerial ability on tunneling is significant, while in the samples with high equity concentration and low equity balance, that is, when major shareholders have more control rights and other shareholders have weak checks and balances on major shareholders, the inhibitory effect of managerial ability on tunneling is not significant, which further reveals the functional boundary of subsidiary managerial ability. After the robustness test and endogenous treatment such as instrumental variable method, grouping regression and substitution variable, the conclusion is still valid. This paper complements and enriches the research of managerial ability in the field of corporate governance, breaks through the traditional "top-down" one-way governance viewpoint, verifies the feasibility of the "bottom-up" check and balance mechanism of subsidiaries, and provides new ideas and empirical evidence for solving the second kind of agency problems characterized by the opportunism of major shareholders.