Research On Power Distribution Between Shareholders’ Meeting And Board Of Directors Of Public Companies

It is a fundamental issue in the company law of the distribution of powers between the shareholders’ meeting and the board of directors of public companies,which is not only directly related to the determination of purpose and path of corporate governance,but also affects the specific system design such as the legal norm structure of public companies,the protection of the rights and interests of various stakeholders in the company,and the composition of directors’ fiduciary obligations.What’s more,it even touches the independent legal personality of the company,which is the cornerstone on which the modern company system is established.Therefore,it has become a major theoretical and practical problem that the legislation and theory of company law in various countries must deal with.Since Bede and Means discovered the separation of ownership and operation of public companies in 1932,the developed countries with foreign corporate legal system,represented by the United States,have focused on how to properly and efficiently distribute corporate power between shareholders’ meetings and boards of directors.The controversy between shareholders’ meeting centralism and board of directors centralism has not subsided up to now,which has caused a long-term debate on the two concepts of shareholders’ meeting centralism and board centralism.A new round of major amendments to China’s Company Law has been launched,and the reform of the power distribution mode of public companies is also its core content,bearing the functional mission of promoting the overall improvement of China’s corporate governance level.Taking the public company of our country as the research object and the maintenance of the independent personality and interests of the company as the starting point and end-result,this paper conducts a systematic research on the natural choice of the power distribution mode between the shareholders’ meeting and the board of directors of public companies based on the local corporate jurisprudence and practice in our country and draw on the relevant theoretical results and legislative experience abroad.On the basis of redefining the legal status of the shareholders’ meeting and the board of directors,this paper determines the distribution concept and distribution principle that our country should choose considering all kinds of influencing factors.Finally,under the guidance of the board of directors centralism concept,it puts forward the specific plan of restructuring the legal system of power distribution between the shareholders’ meeting and the board of directors of public companies in our country.In addition to "introduction" and "conclusion",the research content of this paper is divided into five parts:1.China’s Issue of Power Distribution between Shareholders’ General Meeting and Board of Directors of Public Companies.The legal status of the company organ directly determines the content of its power.Therefore,the current "Company Law" does not distinguish between public companies and private companies,but adopts the method of integrated regulation.The shareholders’ meeting is defined as "organ of power",and the board of directors must "be responsible to the shareholders’ meeting".Therefore,the shareholders’ meeting was given too much power,which reduced the board of directors to its office.As a result,under the realistic situation of "one share dominates" of controlling shareholders,it is difficult to show the independent legal personality of the company,and the independence of the board of directors is seriously weakened.In order to get rid of the above-mentioned legislative defects,the academic circles in our country have put forward various reform plans such as controlling shareholder centralism,manager centralism and board centralism,but they are not perfect,so it is still necessary to rethink and explore them deeply.2.Contention on the concept of power distribution between shareholders’ general meeting and board of directors of public companies.As for the distribution of power within the company,there are always two opposing concepts in the global corporate law theories——shareholder centralism and board centralism.These two concepts hold very different positions on the purpose and path of corporate governance.The former holds that the purpose of corporate governance should be to realize "maximization of shareholder value",so in the distribution of corporate power,the final decision power of corporate affairs should also be reserved to shareholders.However,the latter believes that the purpose of corporate governance should be to realize the interests of all stakeholders in the company.Therefore,the board of directors should be given absolute power over the company’s management decisions so that it can play the central function of balancing the interests of all stakeholders.Disputes over ideas will undoubtedly have a far-reaching impact on the construction of the legal system for the distribution of corporate power.Therefore,it is necessary to deeply explore these two concepts from the basic standpoint and legal basis,and analyze their possible practical impact on the distribution of corporate power in order to lay a solid theoretical foundation for the construction of the rationalization plan of corporate power distribution.3.Extraterritorial practice of power distribution between shareholders’ general meeting and board of directors of public companies.With the continuous advancement of the process of global economic integration,the company laws of various countries in the world are undergoing profound trend changes of integration,convergence and even integration in form or substance.Among them,the developed countries with corporate legal system have accumulated rich and mature experience in the legal system of power distribution between the shareholders’ meeting and the board of directors of public companies after hundreds of years of development and evolution.Although the specific rules of power distribution are difficult to be completely unified due to the influence of the national conditions,the contents that have reached a high degree of consensus are enough to arouse our attention.A comprehensive investigation of the relevant legislation of Germany,France,Japan and South Korea in the continental law system,as well as Britain,the United States,Australia,Canada and other representative countries in the Anglo-American law system,is helpful to provide a useful mirror for the perfection of our country’s system.4.General ideas of power distribution between shareholders’ general meeting and board of directors of public companies.The power distribution between the shareholders’ meeting and the board of directors of public companies is affected by many factors such as the independent legal personality of the company,the ownership structure of the company,the operating efficiency,conflicts of interest and the social responsibility of the company.When selecting the concept and designing the plan for the system reconstruction,it should be considered comprehensively and should not be biased.China’s legislation and theory agree with the reality of the nature of corporate legal person,the ownership structure is still highly concentrated,and the corporate social responsibility is increasingly paid attention to,which determines that the board of directors centralism should be the appropriate concept for China to reconstruct the power distribution system between the shareholders’ meeting and the board of directors.The legal standards and legal effects of power distribution should also be specifically carried out on this basis.5.Specific plan of power distribution between shareholders’ general meeting and board of directors of public companies.After turning to the concept of board centralism,the ownership and operation of public companies are strictly separated,and the power distribution system between shareholders’ meeting and board of directors in China’s current law should be reconstructed accordingly.The power of the shareholders’ meeting shall be defined by specific enumeration,and it shall be strictly limited to the selection of managers and supervisors and the determination of their remuneration plans,as well as the approval power for structural changes such as the amendment of the papers of association,major asset reorganization and termination of changes.The powers of the board of directors should be defined in a general way.Except that the law clearly stipulates that it belongs to the power of the shareholders’ meeting,all the company’s business decision-making power belongs to the independent exercise of the board of directors.The legal power of the shareholders’ meeting is the "negative list" of the power of the board of directors,and its scope does not need to be specifically listed to meet the practical needs of complicated and rapidly changing business practices.