Study On The Performance Evaluation Of IRM Based On Minority Shareholder Protection

The lack of right of speech, poor risk tolerance, weak protectingability and high cost for recourse such alike weakness, often put minorityshareholders in a disadvantaged position in the game with controllingshareholders and senior management. In fact, the protection of minorityshareholders’ interests is very important in maintaining the confidence ofthe whole capital market. Besides relying on the macroscopicmechanisms such as improving the legal, strengthening the supervisionand increasing violation cost to play a role in protecting the interests ofminority shareholders, a recent study has shown that a microscopicprotection mechanisms—Investor Relationship Management (IRM) alsoplayed an important role in improving the corporate governance structureand protecting minority shareholders’ interests.For listed companies, IRM is a system engineering which needs long-term effort, and the performance of its operations not only attracted theattention of the authorities of the enterprise management, but also becomea concern of the parties involved in the capital markets. To measure thespecific efficacy of IRM, we must evaluate IRM performance in listedcompanies. In theoretical research, IRM performance evaluation hasbecome the empirical research foundation in the whole IRM field, andalso become an integral part of IRM implementation process of the listed companies.Building the relevant, quantifiable evaluation indicators, is a key linkin the IRM Performance Evaluation. Based on the value of the companyand investors value creation, we must build the IRM evaluation system,in line with the characteristics of the present situation of China. On thebasis of the previous research, this paper tries to study the IRMcommunication objects-public investor. First of all, it elaborates thatIRM has the protective value of minority shareholders’ interests and thelogical relationship between its other value and minority shareholders’interests protective value; then adds the concept of minority shareholders’interests protection into the listed company’s IRM performanceevaluation practices; builds the IRM performance evaluation index-IRMI which based on minority shareholders’ protection and proves thevalidity of the index; Finally, taking the244selected enterprises from theCSI300Index as example, this paper studies the level of these company’sinvestor relations and has found these sample companies represent thelevel of investor relations as well as a new trend. By detailed displayingof the IRMI index building process, this paper aims at better guidinglisted companies IRM practice, which could establish long-term, stable,and win-win relations with investors.