Institutional Investors Actively Participate In Corporate Governance, Legal Issues

The development of institutional investor has been concerned extensively in contemporary in many countries. In the developed countries, institutional investors have already participated actively in corporate governance. The author hopes to find some benefits to the reform of corporate governance and the development of institutional investor in our country from the realistic experience of these countries. Surely, there are some defects of institutional investor, but it is a beneficial choice to strongly grow institutional investors and make them one of the active owners to the enterprise in the transformation period of China. According to this, the essay brings the law strategy of growing institutional investor in our country.The essay is totally divided into four parties, consisting of 40000 words:Part I: The origin and development and the definition of the institutionalinvestor. This part first introduces the origin and development of the institutionalinvestor in the developed countries and in our county; then this part defines the"institutional investor" after contrasting the different comprehension in thedeveloped countries and in our country.Part II: The rise of the institutional investors actively participating in corporate governance in the developed countries. This part first introduced the development process from "household capitalism" to "manager capitalism" to "institutional capitalism" in the United states etc. Then this part analyzes the reasons why institutional investors participate actively in corporate governance. And at last, this part introduces institutional investors' superiority in corporate governance and in the capital marketPart III: The significance and limitations of institutional investors to the reform of corporate governance in China. In our country, corporate governance faces many contradictions. This part has the idea to grow institutional investors and make them one of the main shareholders in corporate governance. But institutional investors can not be one of the main active shareholders because of many reasons such as the control of market circulating, the restriction of scale and self-governance of the institutional investors, the obstacle for entering into the capital market, and the legal limitation.Part IV: The law strategy to grow active institutional investor for the reform of corporate governance in China, Institutional investor activism benefits to the reform of corporate governance in China, so it is necessary to make institutional investors active. According to the above analysis, this part brings up the measures to grow active institutional investors: take charge of the development of institutional investors; reduce the state-owned shares; strength the institutional investor's management; relax the obstacle for entering into the market; and perfect the system relating to institutional investors in the Corporation Law.