The Research On The Governance Of Fund Management Company

On the18session third plenary, the decision of the CPC Central Committee aboutcomprehensive reform several major issues made to advance the cause of social reformand innovation, and build a more fair and sustainable social security systems, to furtherpromote Fund market-oriented with diversified investment. This proposed newrequirements to the development of the fund industry.With the rapid development ofglobal securities investment funds and fund management companies have increasinglyexpanding, the frequent change of fund management company executives, continuedvolatility in the Fund’s performance, major shareholders too much intervention in thebusiness of fund management companies, fund management companies on the use offunds to transportation for other large shareholders and so on,all this problems havebecome increasingly prominent. So, the research of fund management companiesbecomes the focus of the theory Circle.Current research on governance of fund management companies, mostly in fundmanagement in corporate governance fund managers’ behavior and characteristics, andfrom this perspective it is difficult to fully examining the governance fund managementcompanies, therefore, this paper discusses both Board characteristics and the ownershipstructure of the company,we use fund management companies that has been subsistingand open-end fund managed by sample in2003and2012,the paper makes an empiricalstudy on the relationship between the governance of fund company and the performanceof the fund. The results of the study show that, to the characteristics of board ofdirectors, the scale of board of directors is positively related to the performance of fundsand there was no correlation between the proportion of independent directors or theposition of general manager and the performance of funds. In the equity structure, theperformance of funds is not related with the number of shareholders of fund companies,the proportion of the shares of the fund companies held by securities companies, shareratio of the largest shareholder and the shareholding ratio between the first bigshareholder and the second largest shareholder. In addition, the study finds that there isinversely related between the management fee and the performance of funds. Andaccordingly presents conclusions and outlook.