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Stakeholders participate in the corporate governance of

Author: LiYanLing From: www.yourpaper.net Posted: 2009-04-30 05:34:31 Read:
[Abstract] corporate governance is not just the Board of Directors, management and major shareholders things related to the interests of many stakeholders, stakeholders should be involved in corporate governance. This explore.

Stakeholders and shareholders of the Company jointly owned

As early as 1937 published the famous Coase: Business in essence is a set of incomplete contracts, the owners of the various elements (such as materials owners of capital and human capital owners, that is narrowly defined corporate stakeholders ) its have exclusive ownership of property Contracting. Exchange, their respective share of the ownership of the enterprise, and a concrete manifestation of ownership is the residual rights of control and residual claims. Therefore, the enterprise does not belong to the shareholders of all, but by the multi-stakeholder co-owner. Accordingly, the corporate governance need to rely on multiple stakeholders to participate, not just rely on shareholders. The issue of ownership of enterprises directly related to the allocation of corporate governance rights, stakeholders participate in the corporate governance process is essentially the stakeholders in corporate governance in the sharing of power and checks and balances process.
Range of stakeholders: business-related shareholders, creditors, employees and suppliers and so dedicated capital invested businesses, enterprises lack of any one of them can not continue to exist, and they also undertake the enterprise the risk, so they are all the company's stakeholders, their interests and the interests of shareholders, as should be protected.

The company's goals in the stakeholder theory reposition

Stakeholder theory, the business goal should be "shareholders first" maximizing shareholder value converted to maximize the interests of stakeholders. Only stakeholder parties to win in order to effectively promote long-term sustainable development, not just the increase in short-term interests. Accordingly, the main points of the reform of corporate governance lies: not more rights and control to the shareholders; On the contrary, the pressure of the shareholders of the company's management should be separated, the more rights to other stakeholders, stakeholder participation in corporate governance, so as to achieve the checks and balances of all forces.

Third, our stakeholders participate in the corporate governance of listed companies the status quo

I will discuss the range defined in the state-controlled listed companies. State Holding Listed Companies in China's capital market imperfections, supporting laws and regulations are not sound in the environment developed, each stakeholder group are not sufficiently involved Residual Manipulation of Enterprise and Residual Claim share, did not fully participate in corporate governance, This caused the imbalance between the the enterprise stakeholder group due to the lack of mutual contain, so critical of China's corporate governance is in the capital market is not perfect environment to promote the Group of various stakeholders are motivated, have the ability to share enterprise residual rights of control and residual claims, to participate in corporate governance. Fourth, drawing on stakeholder theory, reinterpretation of independent directors significance in the Chinese corporate governance

The system of independent directors of listed companies in China began in 2001. In August 2001 under the China Securities Regulatory Commission issued a "guidance" (hereinafter referred to as "guidance") System of Independent Directors in listed companies, independent directors is not in the company as duties other than as a director, and directors of listed company and its major shareholders and their employment does not exist that may interfere with the relationship between the independent and objective judgment; independent directors to safeguard the interests of the company as a whole, paying particular attention to the legitimate rights and interests of the minority shareholders will not be harmed. As of the end of 2003, more than 1,300 listed companies in Shanghai and Shenzhen Stock Exchange with a total of more than 4120 independent directors, an average of each company to achieve more than 3; 65% of listed companies, the independent directors account for more than one-third of the members of the Board . From the number of point of view, basically meet the requirements of the "guidance" However, the actual implementation of the results is unsatisfactory. Large number of empirical studies have shown that our independent directors are not independent and can not play the important task of protecting the interests of small investors, and even the media accused of "vase Directors.
From the "guidance" of independent directors in addition to the general director duties, but also has the duties of supervision and restraint largest shareholder, the independence of the independent directors is fundamental to the existence and prosperity. But the reality is controlled by large shareholders or substantial shareholders, the Board of Directors, Board of Supervisors is just a decoration, most of the minority shareholders to participate in corporate governance, the cost is relatively high waiver from the nomination to the final vote, or by the shareholders or The main shareholders have the final say. So independent directors and major shareholders from the date which the natural blood relations. According to a May 2004 survey of independent directors, independent directors surveyed, 63% of the independent director nominated for the board of directors of listed companies, more than 36% of the independent directors were nominated by the largest shareholder, supervisors of listed companies and other shareholders holding more than 1% of the issued shares of shareholders to nominate candidates for independent directors proportion is very small.
In addition, the independent directors of the salary given by the listed company, the allowance standard plan set by the Board, General Meeting of Shareholders; independent directors when exercising its powers the costs borne by the listed company. In theory, the independent directors are employed by all the shareholders of the company, spending their work ultimately the burden of all shareholders. However, due to the above reasons, the independent directors is essentially employed by the majority shareholder, the exercise of his powers naturally constrained by the largest shareholder. So when the major shareholders and the Company as a whole and the conflict with the interests of small investors, can not hear the voice of the independent directors is not surprising. At the same time, because it is difficult to establish a rational constraints and incentives, the independent directors to perform their duties on the dilemma. Independent directors duty is to protect the interests of small investors, if the interests of small investors have been violated, the independent directors should naturally be punished, so once the problems, the independent directors will assume a huge liability. But it can not be established incentives such as relative and restraint mechanisms. If you do not give them enough compensation of independent directors may be because the responsibility is too significant remuneration to independent directors strong incentives, in order to keep their jobs, they may remain silent on many issues, in order to avoid major shareholders make life difficult for; and give up the post.
Establishing Independent Director System in an attempt to solve the problem of damage to the ownership structure imbalance caused by small shareholders of listed companies in China, but the current imbalance in the shareholding structure can not produce truly independent directors, once again caught in the knot of corporate governance. According to Coase, the enterprise does not belong to the shareholders of all, but by the multi-stakeholder co-owner, corporate governance need to rely on the multi-stakeholder participation, rather than relying solely on shareholders, independent directors by the stakeholders nomination or directly from stakeholders. Under market economy conditions, is to guide the interests of the relevant parties have an incentive to participate in the corporate governance of the magic weapon. Truly independent, no relationship was employed by the largest shareholder and corporate parties "independent director" of the incentive to compete with it and their employers - the largest shareholder? Therefore, I propose that independent directors should be the interests of stakeholders Group elected produce, in order to truly represent the interests of stakeholders and major shareholders contend.
Many of our Corporate Governance theory of reference is the practice in developed countries in the West. Western more developed capital markets and better legal environment, corporate governance is a key to the imbalance of power is the managers enjoy residual rights of control and there is no pro-rata residual claim may lead to adverse selection and moral hazard. Therefore, the focus of attention of the Western market economy countries in corporate governance manager supervision and motivation to achieve consistency managers and shareholders' interests; measures taken is to strengthen internal supervision of the Board of Directors (enhanced, especially the independent powers of the directors ), external deterrence (more perfect manager market and M & A market); simultaneous excitation (given to the part of the managers stock options or shares, in order to achieve the enjoyment of residual rights of control and residual claims consistent) to promote good manager residual rights of control. China's current corporate governance also depends on the major shareholders and the government, the few stakeholders participate in the corporate governance, which is extremely unfavorable for the development of the company. Therefore, China should actively take measures to promote the various stakeholder groups to participate in the governance of listed companies, in order to truly promote enterprise development, rather than just copying the Western corporate governance theory.
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