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Company Securities Investment Funds, Corporate Governance Structure

Posted on:2002-07-12Degree:DoctorType:Dissertation
Country:ChinaCandidate:S R ChenFull Text:PDF
GTID:1116360065950417Subject:National Economics
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This dissertation explores the framework of corporate governance in corporate-type fund industry according to the principal-agent theory, aiming to solve the agent problem caused by separation of ownership and control. The research not only fills up the domestic blank in that research area, but also has many practical significances, including: proper orientation of institutional design in the corporate-type fund industry, prevention of misconduct in fund assets management and avoidance of overdoing in regulation of fund industry, turning the corporate-type fund industry into a qualified component in the system of modern financial markets, and thence promoting sustained development of investment fund industry in China.The dissertation consists of three parts, which are divided into 6 chapters.Part One is theoretical section, which is composed of chapter 1, chapter 2, chapter 3, and chapter 4. Chapter 1 is introduction. Chapter 2 reviews the evolvement of corporate governance and its theoretical foundations in order to explicate what is agent problem and its corresponding solutions. Chapter 3 specifies the origination, composition, and characteristics of corporate governance in corporate-type fund industry; analyzes the difference between the corporate-type fund and common stock firm and further the relations between corporate governance in corporate-type fund industry, fund assets management and regulation in the corporate-type fund industry. Chapter 4 provides core contents about corporate governance in the corporate-type fund industry, which include fund manager's incentive and matching disciplinary mechanisms, and sets up corresponding evaluation system.Part two is Chapter 5, which, using modern econometrics techniques, empirically analyzes the ability of independent directors of boards of corporate-type funds to align the interests of investors and managers of corporate type funds. The empirical method is to adopt the value enhancing hypothesis and value irrelevant hypothesis to explain the role of independent directors and whether they increase fund performance and reduce fund fees and thus add net welfare for investors. Through the three hypotheses, interest-alignment hypothesis, job effort and complexity hypothesis, and fund director labor market hypothesis, this section discusses factors influencing fund directors' compensations. The sample frame for the study is selected from mutual funds of American.The empirical results show that empirical study supports the value-enhancing hypothesis in explaining the role of fund independent directors. Particularly, professional directors can obviously enhance the performance of non-complex size fund. And no empirical evidence is found concerning the simultaneous interaction of board composition and director compensation in the determinants of fund performance and fees. The empirical results also show that the job effort and complexity hypothesis and the fund director labor market hypothesis are more relevant than the interest-alignment hypothesis in explaining variation in the determinants of fund director compensation, that fund director compensation has no uniform criterion, because this has to do with fund variety, diversities of fund investment objectives and ability of fund directors.Part three is Chapter 6, which discusses policy implications and makes some predictive suggestions. This chapter analyzes the present conditions and problems in the corporate governance of securities investment fund in China and makes the predictive suggestions.The main predictive suggestions are as follows:First, professional directors should be regarded as the direction in the future. Independentdirector mechanism should be further perfected. The purpose is to make full use of the abilities and responsibility sense and roles of fund independent directors concerning choosing fund managers in advance, overseeing them in course, and setting up incentive mechanisms for them.Second, corporate governance in the corporate-type fund industry should be in line with...
Keywords/Search Tags:The Principal-Agent Theory, Corporate Governance in the Corporate-Type Fund Industry, Fund Professional Director, Regression, Bonus Bank
PDF Full Text Request
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