Study Of State-owned Enterprise Corporate Governance Structure And Board Of Directors System

Corporate governance is a branch of modern enterprise theory. With the separation of ownership and control in modern company, there are differences of interests and goals between the owner and the manager which can give rise to the so-called principal-agent problem including adverse selection, moral hazard, internal control etc. In order to protect the interests of shareholders, it is necessary to supervise the agents'behavior. The corporate governance mechanism is mainly aimed to resolve the principal-agent problem.On the whole, there are two kinds of models on corporate governance. One is the outer supervising model and the representative countries are the USA and the UK. The other is the inner-supervising model and representative countries are Germany and Japan. The structure of company in the outside supervising model adopts the unilateral-pattern system which means the rights of decision-making and supervision are performed by the board of directors under the board of shareholders. However, the inner supervising model adopts the bilateral-pattern system which sets up the board of supervisors, combining with the board of directors to improve corporate governance. The board of supervisors has the right of supervision and the board of directors has the right of decision making. Generally speaking, the main difference between these two kinds of models is that whether there is a special supervision organization or not.Under China's current corporate governance structure, provisions for the board of directors and board of supervisors are a mixture of America, Britain, Germany and Japan. Board of supervisors and board of directors are parallel,belongs to bilateral-pattern system which are close to the Japanese model; Large state-owned companies implement the supervisors assignment system to strengthen monitoring and evaluation of the directors, which are close to the German model; Listed companies while establishing the board of supervisors also are required of the establishment of an independent director system, which highlighting the characteristics of British and American model.The model of China's corporate governance belongs to the outer supervising model in nature. But the truth is that the board of supervisors failed to achieve its target to supervise the manager. In view of its high efficiency in USA, China introduces the independent director system to strengthen the supervision in the inner structure of corporations. As a result, it forms the situation that the board of supervisors coexists with the independent director system. The relation between them and their effects on improving the corporate governance have been debated fiercely by scholars. They do their empirical researches on above-mentioned problems from different aspects.This article takes Shanghai State-owned Assets Management Committee Group Holdings listed companies as the research objects, the main source of information are from these listed companies'reported 2008 annual reports. After processing the data in the annual reports and using the statistical software-SPSS to do multiple linear regression analysis about the data collected, it investigates the correlation between independent directors,board of supervisors and corporate performance respectively by empirical research of corporate governance supervising mechanisms. The empirical results show that the performance of listed companies have positive correlation with the number and salary of independent directors which matches the hypothesis of rational person in economics; while the board of supervisors have almost no linear correlation with corporate performance, which confirms the opinion of the failure of basic functions of the supervisory board in our country.In fact, no matter what supervising means takes, the key is to ensure their complete condition of effective effect, not to be a mere formality. This paper analyzes the multiple reasons of imperfect corporate governance and invalid supervising function of state-owned enterprises. Then it explores how to further promote the building of state-owned enterprises'corporate governance structure, and make board of directors as well as board of supervisors work effectively. I hope that it can play a positive role in improving China's corporate governance structure.