Research On The Mechanism Of Listed Companies Protection Of Minority Interests Based On The Balance Of Major Shareholders In China

With the continuous development of social economy, it is becoming more serious that the minority shareholder rights have been violated in corporate governance. Therefore, to enhance protection of minority shareholders of listed companies has become an urgent need to address corporate governance problems. This paper is to discuss the interests of minority shareholders of listed company protection mechanism. In practice of corporate governance, the right to equality of the shareholders is achieved by equity, which is bound to the formation of the control status of large shareholders. In most cases, the less minority shareholders hold, the smaller they impact on the company's business decisions, which result in a weak and passive position. The abuse of their dominant control status and the principle of using capital majority damage the benefits of company or other shareholders, making the minority shareholders become a major victim in the lack of checks and balances. In order to protect the interests of minority shareholders, to enhance investor confidence and enthusiasm, to ensure stable and healthy development, we must take effective measures to improve minority rights protection mechanism.To protect the rights and interests of minority shareholders, the checks and balances to major shareholders should be strengthened. In this paper, the methods of comparative analysis, historical research, liternture analysis and simple data analysis are used to try to improve the protection mechanism of minority rights. Firstly, our status of equity governance is analyzed through the ownership structure and the basic relationship of corporate governance, which is elucidated based on the basic concepts and basic theory of corporate governance. Ownership structure could affect the choice of governance model, and then influence the mechanism of corporate governance. On this basis, governance of listed equity status is summarized from the data on the characteristics of China's Listed Companies analysis. It indicates that the problems of the violated minority shareholders are becoming more seriously in the special situation ownership structure of state-owned shares in listed companies. In addition to establishing appropriate corporate governance, the checks and balances to protection of minority shareholder interests will undoubtedly become the starting point. Secondly, it is to study the legal restriction to the fiduciary duties of controlling shareholder. High concentration of listed companies ownership structure makes a high degree of separation of ownership and management. Controlling shareholders use their absolute advantage for personal gain, against the interests of minority shareholders. In this case, it is necessary to control the fiduciary duties of controlling shareholders in order to reduce their abuse behaviors and protect minority interests. However, the fiduciary duty of controlling shareholder is still a lack of legal restrictions, and the external monitoring mechanism is not perfect. Therefore, we need to draw on the experience of controlling shareholders to fulfill fiduciary duties in foreign companies. And combining with our actual situation of controlling shareholder performing fiduciary duties, we try to build a legal restriction style for our special ownership structure, and improve the protection mechanism of minority rights and interests. In addition, it is to improve the independence and the operation of director system from the monitoring point of view. The introduction of independent director system in China, is mainly to ensure the independence of the board of directors, then to play an effective role in company decision-making and supervision of the company's managers. Meanwhile, the independent director system also played a positive role in protecting minority interests. This article analyzes the status of the independence and operation in directors system of listed companies, and find out a point of conflict in functions between independent directors and board of supervisors. It indicates that we should make a clear division of labor between the two functions, and make them fulfill their duties to play a supervisory role. And gradually, improve related measures of the independent directors system, and improve internal supervision mechanisms to protect minority shareholders rights and interests. Finally, it is need to find some methods to improve legal assistance to minority interests. Giving the right of representative actions to minority shareholders is discussed in this article. We use comparison analyzing method to introduce the shareholder lawsuit related basic content in U.S. and UK, and combine our actual situation to address corresponding suggestions, in order to improve the litigation on behalf of our shareholders and provide an effective, feasible, and efficient legal aid way to protect minority interests.