Monitoring Mechanism For Corporate Governance

Our society has already focused on how to push the reformation of governance of Chinese listed companies. And how to construct the effective mechanism of monitoring and controlling is the most important thing in it. This dissertation has discussed the operation of mechanism of monitoring and controlling of Chinese listed companies on the point of view of management and economics and made some suggestions.There have been a lot of theories on how to consummate the corporate mechanism of monitoring and controlling. This dissertation has first summarized some representational subject matters, such as the design of board structure, the status and effect of tinstitutional investors, market for corporate control, theory of stakeholders, nexus of ownership structure, financial structure and corporate monitor. Among those subject matters, theory of stakeholders is the logic basis of the theoretical framework of the corporate mechanism of monitoring and controlling in this dissertation. Because the economic interest relations between those stakeholders whose title and obligation are decided through contracts among the inside and external stakeholders such as shareholders, creditors, employees, governments and correlative management department are formed through contracts and have legally permanent sanction and strong force, those stakeholders play a very important role in the construction of the corporate mechanism of monitoring and controlling.Basing on the analysis of monitoring and controlling function of the inside and external stakeholders, this dissertation has represented an operational framework of the inside and external corporate mechanism of monitoring and controlling. Inside this framework, through different ways, different stakeholders act as monitors intervene and influence the monitoring and controlling on Chinese listed companies in the different extent. Besides the inside mechanism of checks and balance composed of shareholder meetings, board and supervisory board, market monitoring including market for corporate control, CEO market, production market and other external stakeholders such as banks, employees, governments and management department of securities business also exert a profound influence on corporate monitoring and controlling.Otherwise, from the corporate system, we can see that there should be a perfect safeguard system to ensure the effective operation of corporate mechanism of monitoring and controlling. And the organization structure and operation procedure control in the inside controlling mechanism of corporate management system, especially the information support provided by the inside audit through management operation is the exact important element in this safeguard system. The effective operation of corporate monitoring and controlling depends on the systematic conformity of corporate management and corporate governance. To some extent, the systematism of management and governance mostly manifests the harmonizing development of governance structure and management because Chinese listed companies' external market mechanism of monitoring and controlling could not be able to exert a strong and effective influence in the short run.We have reviewed the evolvement of the mechanism of monitoring and controlling of Chinese listed companies in chapter 4, and at the same time, we have had empirical analysis on the limitation of the inside and external corporate mechanism of monitoring and controlling. And we have also had empirical analysis on the efficiency of corporate mechanism of monitoring and controlling. Among the empirical studies of ownership structure and corporate performance, we have choosed the checks and balance degree of ownership, the convergence degree of ownership and floating stock proportion as independent variable, and ROA showed as corporate performance as attributive variable. Through the regression analysis of corporate performance, we have made a conclusion that the relative convergence of ownership is beneficial to advance the efficiency of corporate moni...