The Research On The System Of Directors' Salaries Of Chinese Public Corporations

The problem of incentives for managers of the companies has been a hot topic among experts on company law ever since 1932 when Berle and Means first brought up such question. It not only concerns the effectiveness of market economy system, but also relates to the better achievement of corporate governance. As the main carrier of a country's economy and the main provider of tax, the listed company has a great significance on national economy. In the new period of deepening the reform and opening up, it's important to research on the effective mechanism of the remuneration of the directors of listed companies. Meanwhile, the problems of remuneration of directors are brought up by public and the media at the background of the financial crisis. The relevant departments and agencies should pay much attention to this.The remuneration system of directors can be concluded as one core question—the fairness, which includes the fairness of formality and substance. The systems for the formal fairness are the disclosure of remuneration of directors, the remuneration committees, the independent directors, the approval of shareholders' meeting. The systems for the substantial fairness are the business judgment rule and the sensitivity of the remuneration.The remuneration system of directors must be established in such a theory basis: the private law autonomy, ensure the basic principles of company law and economic system of marketing does not occur essentical change. Keep the trustee obligationes of directors, ensure the rights and obligations are equal. And respect the fairness and justice, to build a harmonious modern democratic society.In practice, there're conflicts between the system itself and the practice, the public evaluation and the trend of the companies. So there are special changes. The first is that the country steps into the problem. The Second is that the crisis of public confidence of the high payment and the corporate governance. The third is that the requirement for substantial fairness is more strict than the formal fairness.So some recommendations are brought up to ensure effectively solve the problems today and ensure that the corporate governance mechanism is not destroyed and the company system will have long-term development. The recommendations include:We should give the shareholders'meeting the final say and ensure the independence and fairness of the remuneration committee. The minority shareholders are protected by the derivative action. The business judgment rule and the legality of the procedure are obeyed in judicial review. These recommendations may be useful for better corporate governance of listed companies and the legislation of the policy of directors'remuneration.