Independent Director System In China

The introduction and recommendation on transplanting a regime of independent directors in this dissertation intent to achieve a high level of corporate governance in China by means of consummating the structure of corporate governance, and to the end, to protect the medium and small shareholders' rights and benefits. To fulfil this target, some research methods such as comparative methodology, theoretical and practical systems analysis, etc. were applied to distinguish the regime of independent directors and the existing problems in relation to this issue in China from those in the foreign countries by examining the background in the derivation of independent directors and evaluating this legal device institutionally. It is concluded that the domestically specific legal environment should be taken into consideration as to the references and evolution of the foreign regimes of independent directors are independent directors on the one hand and, present a framework for law-making on this subject and enhance the coordination between the independent directors and the board of supervisors on the other hand. Meanwhile, the viewpoints on how to perfect the regime of independent directors in China are proposed too. The thesis consists of five parts which will be further discussed as followed: Part I concerns the origin and causes of the regime of independent directors. The fundamental functions and execution of independent directors in the United States are probed into. Independent directors keeps its paces with the development of the corporate in civil law countries whilst the legal concept came into being during the period of 1960's and 1970's. The objects of putting independent directors under the umbrella of corporate governance is to supervise the executive directors on one side of the coin and present some scientific suggestions regarding the company's decision making and strategic development on the other side of the coin.Part II is to comprehensively evaluate the regime of independent directors through different understanding and assessments domestic and abroad. It is convincing that the regime is on the demand of development of the corporate governance and worth of being studied and referred to, it further proposes to design a suitable regime of independent directors under Chinese special circumstances in relation to this matter.Part III discusses the necessity and feasibility of transplanting a regime of independent directors into China, which is analyzed below: first, in theory, it emphasizes that it is essential to setup a regime of independent directors when the characteristics of corporate governance in China are taken into account; secondly, the affirmation and efficiency of independent directors in practice is significant.It argues in Part IV that the functions of independent directors have not been completely employed due in to the imperfectly existing system even though the regime has being played an important role within the structure of corporate governance in China, which is based on a study of the results of questionnaires and investigations into independent directors conducting by Peking Branch of the CSRC and the relevant analysis on the development and exercises of independent directors in China.