| Starting and development of Financial Industry Group is a significant phenomenon in the period of Russian Transformation. Russian Federal Law "about Financial Industry Group" stipulated that Financial Industry Group refers to the total of legal persons which the parent company and the subsidiary company completely or partially unite their own matter and non-matter (stock)property on the foundation of Financial Industry Group Agreement. In the term of economic form, it is a kind of holding company, as a parent company who owns the stocks of a series of productive or credit financial subsidiary companies. In the term of objective basis, it is a big group of enterprises which is established in the combination of industry with finance and a special performance of the combination between industry and finance in the period of Russian Economic Transformation.Financial Industry Group is the product of Russian Radical reform and special privatization policy. After Russia started economic reform, serious recession of macroscopic economy and the severance of enterprises'fund chains led to deficiency of enterprises fund. In order to obtain necessary fund to maintain survival, a part of conditional enterprises or enterprises groups started to attempt at constructing financial organs to help themselves; Simultaneously, some powerful commercial banks also began seeking to participate and share industrial profits. Thus, at the beginning of Russian Transformation, there was a tendency that the mutual relations between big industrial enterprises and some financial organs were unceasingly strengthened, and finally huge Financial Industry Group was formed. Following this, along with the adjustment of the national privatization policy and the unceasingly deepened political support, Financial Industry Group became strong rapidly and a batch of financial magnates who controlled the forces of nature on the stage of Russian politics and economy arose.In the forming process of Financial Industry Group, the national policy had provided an important support of exterior institution. It was in political consideration and also in the economic need that Russian government supported the Financial Industry Group. In politics, it conceived of molding profitable groups in the initial period of reform to overcome the formidable political resistance which reform faced; In economy, it hoped to drag economy out of crisis and then impetus the development of economy relying on the powerful large-scale Financial Industry Groups. Under the vigorously support from the state power, Financial Industry Group grew rapidly and became a strong interest group which could contend with weak government. In the Yeltsin time, Russian government was often surrounded by Financial Industry Group and even had to compromise with the Group for its own survival. For example, in 1995 under the pressure of financial crisis and inflation, the government had to accept Botaning's (one of latish seven oligarchs) suggestion of dealing with big enterprises by mortgage and auction. Just in this course of mortgage and auction, several Russian financial magnates formed. In return for their succeeding in subsidizing President Yeltsin to continue in 1996, some financial magnates were appointed to hold important posts of government and started to participate directly in the political agenda. Hereafter the antennae of Financial Industry Group extended quickly to each domain of society including media and diplomacy, therefore, Financial Industry Group also entered into its most prosperous period of development. But their excessive intervention in national affairs incurred intense dissatisfaction of other special interest groups including the government.As an organization form of economy carefully cultivated by the nation, Financial Industry Group is an innovation of enterprise institution in the period of Russian Reformation. Therefore, studies of its institution structure are very important. The institution structure of Financial Industry Group includes the corporate governanceof enterprises, organizational structure, management system, interior relations between banks and enterprises and so on.We should study the corporate governance of enterprise from the property rights as well as domination ones. Taking officially promulgated"Russian Law of Federal Joint-Stock Company"in 1996 as demarcation, the development of the corporate governance of Russian company can be divided into two stages: in the former stage it is a typical insiders control corporate governance. The insiders (managers and staff) have absolutely majority stocks and managers have firmly grasped the domination of company. In the latter stage, along with the speed of privatization slowing down, problems of the efficiency of enterprises after the privatization were paid more attentions to, thus insiders control was under a certain control. The stock shares of the interior persons dropped and the stock proportions of the exterior persons rose. Adapting to this, exterior share holders had also obtained more and more domination in the company. But until now, the problem of insiders control in the interior of enterprises hasn't been reversed fundamentally. The rationalization of corporate governance structureof Russian big companies and its maturity need a long-term endeavor.As a large industry group, Financial Industry Group has not only huge properties, but also complex business structures. Therefore, establishing a reasonable organizational structure and a control system of management is also essential. Looking in the term of organizational structure, the typical Financial Industry Group uses the system of holding company. The parent company holds partial or complete stocks of the subsidiary company which has independent legal personality and forms relatively independent profit centers and investment centers. The influence of the parent companies on the subsidiary ones generally plays through the organizational structure of the subsidiary companies such as board of directors and so on. The control and the surveillance of the parent companies is quite indirect. Looking in the term of management system, in the interior of Financial Industry Group's parent company, administrative system is the foundation of management and control. The encouragement and penalty based on inspection of achievement is the main method of management control. But the management control of the parent companies on the subsidiary ones is relatively more complex, and the specific pattern is different according to the nature of different subsidiary companies. Generally speaking, it is the composite structure of the control of bureaucrat type and market type.Financial Industry Group is a product which the industrial capital and the banking capital combines together, therefore the relations between banks and enterprises in the interior of group are one of its most important economic relations. The banks unify enterprises mainly through the relations of stockholder's rights and credit. Russia carries out versatile comprehensive bank system like Germany. The commercial banks are authorized to negotiate security services, so banks may share the industrial profits through purchasing company's stock. Bisides this kind of direct capital participation, banks can help the enterprises to gain investment fund through offering loans. But because of long-term economic recession and vicious inflation after reformation, most of Russian commercial banks put majority of funds in national security markets which can bring higher profits and higher security. Due to unwilling to invest and offer loan to enterprises, the support of banks to entity economy is weakened and the union condition of banks as well as enterprises in the interior of Financial Industry Group is not good.Financial Industry Group has had a profound influence on Russian politics and economic reformation. As an interest group in earlier period of reform, it captures the federal state by using its formidable economic potentiality and has hindered the further reform aiming at redistribution of the benefit. This causes Russian economic reformation to fall into the inefficient lock - in . Financial Industry Group also creates oligopoly and sole management, and intensifies the inequalities between areas, industries and enterprises in Russia. While Financial Industry Group also has a certain positive influence on the national economy, it has played a vital role in helping country regulate the movement of macroscopic economy, establishing marketizational fund-flowing mechanism , participating international competition on behalf of Russian enterprises and so on. Looking in the term of its own economy's performance, Financial Industry Group was the most active department in Russian economy in 1990s. Compared with other economic forms of organizations, Russian Financial Industry Group always has the higher labor productivity and the better economic benefit.Although it displays good economy's performance, developing Financial Industry Group actually receives dual restriction from the disadvantageous environment of exterior institution and unbalanced structure of internal institution. On one hand, the chaotic and disorder economic and political environment in the period of Russian reformation is the window of opportunity by which Financial Industry Group can rise rapidly in a short-term. On the other hand, it will inevitably become the shackle and barrier which affects its long-term development. These environment flaws of exterior institution include: the political context flaw which support government by law and the good faith, the deficiency of effective national strategy which is in view of the development of Financial Industry Group, as well as the restriction of weak bank system and so on. In addition, the internal institution structure of Financial Industry Group is also unbalancing. Looking in the term of interior leadership mechanism of group, the stronger personalized characteristic of Financial Industry Group is very easy to cause the group to have crisis because of the changes of enterprise's leader. Looking in the term of the interior corporate governanceof group, serious insiders controll system lead to lacking of surveillance to managers and the rights and interests of little shareholders are destructed. Moreover in order to maintain the vested interest of managers and workers, enterprises can't obtain necessary exterior fund for reorganization. Looking in the term of interior organization system of group, compared with western enterprise groups combining the industry and finance which have developed for hundred years, the organizational structure of Russian Financial Industry Group is quite scattered and lacks effective management mechanism. Looking from the interior relations between banks and enterprises of group, the degree of capital fusion between banks and enterprises is not high. The function of banks on the fund supply of enterprises is also limited. That is to say, although enterprises have intense need for fund, big banks of group are actually not willing to provide more loans for them.Due to the environment flaw of exterior institution and the unbalance of internal institution structure, the development of Financial Industry Group gradually falls into a difficult position. But since financial crisis in 1998 and alternation of state power in 2000, the environment of Financial Industry Group's exterior institution has some new changes. These changes include: the gradual growth of special interest groups which contends with Financial Industry Group, the strengthened demand of the government by law, competitive economy and certain development of the transaction markets of property rights and so on. Changes of exterior institution environment urge Financial Industry Group to have to carry on corresponding transformation of system. The prospects of development of Financial Industry Group are decided by the final effect of this kind of transformation to great extent. Currently speaking, although Financial Industry Group has lost the special support of the state power and oligarchy also tends to declining, its mechanism of management actually tends to standardizing unceasingly. As a kind of new form of enterprise organizations, it is sure that Financial Industry Group will still play an important role on the arena of national politics and economy. Its function in the recovery of Russian economy still can't be substituted.This dissertation designs a institutional analysis frame to analyze Financial Industry Group comprehensively from the angle of institution change. The basic contents were the institution background and root of group, the internal institution structure and exterior institution environment of group, economy's performance as a kind of innovation of enterprise institution as well as the prospects for development under the new institution environment, etc. Putting the analysis of Financial Industry Group into the theory frame of institution change can combine the analysis of Financial Industry Group with the analysis of Russian economy transformation, help people understand the Russian economy transformation from the angle of entreprise institution better, and also provide important theory reference to explain some critical problems such as the choice of Russian reform stratagem,the development of the transtion path,the evaluation of transition effect.Under this dynamic analysis frame of institution, this dissertation analyzes the essence and function of Financial Industry Group separately from politics and economy by utilizing many theory tools such as the theory of enterprise organization and the one of special interest group and so on. The author points out that Financial Industry Group is a contradictory complex compound which display completely opposite function in the national politics and economic domain. This breaks the limitation that former studies purely carry on the analysis from political or economic angle. So this research is more comprehensive and the conclusions are also persuasive.The analysis of the ralation changes between Financial Industry Group and political power also provieds helpful theory reference to understand the other important factor-the government transition in Russian econom transformation.Like Russia, China is also a great transitional nation and demands objectively the combination of industry and finance in the process of its market economy transition. Therefore, establishing enterprise groups which combines industry and finance recently has become one of the hot spot topics. It is a huge and complex project to establish enterprise groups which combines industry and finance in transitional economy involving many works such as the reform of enterprise property rights, the design of structure, the reform of bank system and so on. In this process how to avoid these questions(for example, the draining of state assets, vague corruption of administration, low level of corporate governance, the enlargement of financial risks and so on) is the key of this project and even the entire economic reformation. Regarding the processing of these questions, we perhaps may draw lessons from the formation and development of Russian Financial Industry Group. If it can be so, the research of this dissertation will be a significant work.
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