Corporate Governance Structure Analysis Of The Effectiveness

The listed companies constitute the foundation of stock market and their quality and performance directly determines the development of the market. There are two basic characteristics of the modern companies. The first is that the companies' assets are made up through many investors' capital, the investors are responsible for the companies' liabilities only limited to their own stock-capital; the second is the separation of ownership from managerial authority, the manager of the firm is not the owner in general. It is these characteristics that are essential to set up an effective corporate governing structure .It guarantees the assets safety and profit maximization through allocating and exercising the managerial power of the firm. So we conclude that a sound corporate governing structure is modern the core for modern firms. In January 2002, China's Security Exchange Committee together with the Economic Trading Committee publicized《Principles for improving the governing structure of the listed firms》, it would help the firms to set up effective governing structure and therefore is of great importance in establishing a modern enterprise system in this country.There are 1,200 listed companies up to now in China, and more companies will be listed. In this paper, the author takes the efficiency of the listed companies' governing structure as the research focus. Modern Firm's Propriety Supposition and the theory of the firms' Governing Structure are adopted to explore the efficiency and to explain some drawbacks of the listed companies. So it serves to lay a foundation for setting up a reasonable and effective governing structure and a modern enterprise system for these companies.This paper has got four parts, the main contents are as follows:Part one discusses the modern firm's propriety supposition and the theory of the firms' governing structure. There are two characteristics of modern companies related to propriety right. The first is the separation of ownership from management right, the second is about highly scattering and circulating of stock-capital. We explain all the issues modern propriety right theory concerns. We then discuss the principal-agent relation and corporate governing problems. This part gives a theoretical basis for setting up reasonable and effective modern corporate governing structure.Part two is the comparison of corporate governing structures of different countries. In this part, we analyze the basic characteristics, stock-capital structure, and stock-capital concentration degree of corporate governing structures in different countries. Then we discuss the corporate governing structure's dynamics in different countries and their effect on the governing issue, on the manager's incentives and restraining mechanism. In this part, we can benefit from foreign countries' experience ,and this will help us set up a reasonable and effective corporate governing structure.Part three is the positive analysis of China's corporate governing structure issue. In this part, we analyze firstly the corporations' stock-capital structure and concentration degree through description statistical methods, and then make a regression analysis for the stock-capital structure and operation performance through OLS based on the past cross-sectional data of these corporations. The last part we point out the drawbacks related, and suggest a few reasonable ideas and policies.