Research On The Ethics And Compliance System Construction Of China Listed Companies

The principal-agent relationship, asymmetric information and moralhazard problems are the key issues of the studies of Modern CorporationGovernance.Under the considerations of regulatory costs andeffectiveness, a system needs to be designed to maximize the legal rightsand interests of medium and small shareholders and other stakeholders.“Markets should play a key role in the resources allocation”, whichis emphasized on the Third Plenary Session of the18thCPC Central Committee,and the proportion of the direct financing in the total social financingshould be increased. Therefore,Chinese enterprises will complete thedirect financing more through the capital market in the future. However,due to the incomplete supervision of Chinese securities market and thelack of ethics and compliance concept among the listed companies or otherfinancing enterprises in the capital market, encroaching upon thelegitimate rights and interests of small shareholders and otherstakeholders has occurred occasionally. The protection of legal rightsand interests of small shareholders and stakeholders and to promptregulate development of listed companies, are one of the importantcontents of the sustainable development in China’s securities market.At the beginning of the twentieth Century, chief ethics and complianceofficer were set up in America enterprises to make sure companies sharemore social responsibilities and to protect the legal rights and interests of investors. Considering the practical situation and problems of theoperation of Chinese listed companies，supervision departments and somelisted companies in China start to pay attention to the enterprise ethicsand the establishment of regulatory compliance system in recent years.Valuing the system, mechanism, implementation and effectiveness, andimplementing this concept to the consciousness and behavior, make allemployees of listed companies can consciously maintain the interests ofthe company and the stakeholders.In China’s current political and economic environment, promoting theconcept of enterprise ethics and compliance system and establishing theethics and compliance systems are related to the healthy development ofenterprises, and are important requirements for enterprises to practicethe core values of new period of socialist.As an artificial person, enterprises should put the core values, whichare advocating prosperity, democracy, civilization, harmony, freedom,equality, justice, advocating the rule of law, advocating patriotism,dedication, honesty, kindness, to the daily operations, in order tocultivate good social morality, improve the standard of social morality,and promote the development of social economy.The “socialist core values”, enterprise market value maximization,the protection of minority shareholders and stakeholders, and the marketregulation should be combined effectively to reflect the essence ofsocialist countries and the sharing fruits of reform and opening-up byall people in China.In order to make the listed companies continue long-term development,the organic combination of internal ethics and external compliance isneeded to establish ethics and compliance system. In this paper, ethicsand compliance system, these two aspects are combined, which will break the previous isolated research approaches. Starting from the origin ofthe concept of corporate ethics and compliance, through the introductionof the historical evolution, this paper will reveal the problems of theconstruction of ethics and compliance system among listed companies inChina, and put forward the policies and suggestions to optimize the ethicsand compliance construction of corporations.