Study Of Corporate Autonomy Limits

Limit of corporate autonomy is an indispensable part of corporate governance research; it is also a logical conclusion of the theoretical research of corporate autonomy. In fact, limit of corporate autonomy is not merely a question of state intervention; it has its complex theoretical background. However, the existing theoretical research from overseas academia on the limit of corporate autonomy has been focused on relations between shareholders and the corporation while multi-perspective study and analysis on this topic is insufficient. And this topic did not even come to the academic domain in China until recently; achievements in this field have been limited to the realm between state intervention and corporate autonomy while breakthroughs are rare. The lack of theoretical research has a direct impact on the structural reform of domestic corporate governance; it also results in the embarrassing fact that our corporate autonomy practices are decoupled from law enforcement Meanwhile, because of insufficient understanding of this topic, the Corporate Act of 2005 failed to thoroughly address the problem despite the fact that this act reflects modern corporate legislation's values. Thus, in order to fill the blank of theoretical research and provide academic support for realization of corporate autonomy in China, this dissertation aims at studying this issue from the perspective of economic law.This dissertation's standpoint is to support corporate autonomy; it covers a number of issues related to corporate autonomy through multi-disciplinary, comparative, logical and empirical analyses; it also tries to disclose the reality of corporate autonomy in China before it goes further to provide explanation and forecasting. There are six chapters which are grouped into three parts in this dissertation. The first part (chapter 1 and 2) is the basics, which gives explanation to the general principles of corporate autonomy and demonstrates theoretically the reasonableness and necessity of corporate autonomy. The second part is the main part (chapter 3 & 4), which covers theoretical studies, i.e. analyzing the limit of corporate autonomy both internally and externally. The third part (chapter 5) is empirical analysis, which combines China's specific situations with academic studies, and gives forecasting for academic research and systematic improvement in China.The following is a more detailed description of each chapter's content.Chapter one—Basic theories of corporate autonomy aims at explaining the question of what is corporate autonomy. Because corporate autonomy is a quite arguable concept; different scholars has very different explanations for its intension and extension. In order to provide a starting point for the study of corporate autonomy's limits, this part covers basic questions of this concept. It first describes the origin of corporate autonomy. This dissertation supports the opinion that corporate autonomy's origin is closely linked to prinzip der Privatautonomie; in essence, corporate autonomy is a reflection of prinzip der Privatautonomie in corporate system. This chapter looks backward to examine the origin of the thinking of corporate autonomy. This chapter then tries to reveal the basic content of modern corporate autonomy, and points out: corporate autonomy is a corporation as a market principal's rights of self-decision-making, self-operation, self-governance, self-ruling and self-risk-taking. And these rights cover two major areas: internal distribution of power and interest and the interaction with external parties. Based on this definition, this chapter analyzes specifics from several aspects of a corporation, including corporate charter, operation and dissolution. Then this chapter examines the behavioral principal of corporate autonomy and concludes that the modern pattern of corporate autonomy is centered on board, combined with shareholders' meeting. Finally, this chapter studies the path to acquire corporate autonomy, i.e. how to realize autonomy from the perspective of corporate board and shareholders' meeting.Chapter two—Theoretical basis of limit of corporate autonomy aims at exploring the existing reason of limit of corporate autonomy. It is a reflection of right of freedom in corporate system that corporation could decide anything on the basis of prinzip der Privatautonomie. But it is not said that there is no limit or regulation when corporation is realizing its freedom. As a matter of fact, we could not study or explain any theoretical research only by a single and absolute factor or reason. So, only start from multi-disciplinary method, can we get more persuasive conclusion. On the basis of this definition, this chapter examines and studies the reasonable and necessary existing of limit of corporate autonomy from economic base, ethic base, legal base and social base.Chapter three—the interior limits of corporate autonomy aim at studying the interior regulation from corporate autonomy. Although corporation is a self-interest body in nature, we don't indulge corporate autonomy without limits during emphasizing corporate autonomy. In fact, there are some limits in corporate autonomy. This chapter mainly examines the interior limits of corporate autonomy, especially studies from the harmony of the interest's body in corporate and the reflection of corporate culture. The harmony of the interests bodies in corporate covers the construction of the fiduciary obligation of the boards, the regulation of the major shareholders and the protection of the creditor. In completely, this chapter aims at two aspects. One is that the reasonable estimation of corporate autonomy depends on the harmony of interior interests of corporation. Without the harmony of interior interests of corporation, the relation basis of the development between the participators of corporate will be destroyed; it also will destroy the value of corporate autonomy, and could not supply the everlasting power for corporate autonomy. In accordance with this reason, the definition of the limit of corporate autonomy, aims at the realization of the reasonable development between the interior interests body of corporate and the enhancement of economic progress of corporate. The other is that as a potential interfering power of corporate governance, the corporate culture is the interior consolidation of the philosophy of corporation, the spirits of corporation and the behavior of corporation. This chapter points out that the corporate culture relates with corporate autonomy tightly and closely. Through regulating the interior and exterior relation of corporation, corporate autonomy supplies the precondition basis for the corporate culture, and with the concrete system measures, it could realize the everlasting development of corporation. At the same time, after the corporate culture comes into being, corporate could regulate the behavior model of participators of corporation, in order to construct the reasonable and legal base of corporate autonomy, and with the abstract guiding ideas, it could advance the efficiency of dealings of corporation.Chapter four—the exterior limits of corporate autonomy aims at studying the exterior regulating from corporate autonomy. This chapter points out: corporation is the basic body and power in the social and economic activities. The economic activities are not only aiming at interests, but also cover some social sphere. It is the important reflection of corporation in social and economic activities that we should regulate and limit the behaviors of corporation under the background of the whole society. Only by this way, we could realize the harmonious development between the corporate autonomy and social whole interests. In completely, this chapter individually examines the exterior limit of corporate autonomy through the relationship between corporate autonomy and state, society, trade association. Firstly, every country always uses many direct or indirect measures to interfere with the corporate governance nowadays. Although these concrete measures of economic intervention sometimes does not aim at corporation, these measures still inflect corporate autonomy more or less. So, this chapter study from the perspective of economic law, defines the basic intension of state intervention, and completely explores the state intervention on corporate autonomy from legislation, administration and jurisdiction. Secondly, considering .that corporation has grown one of the basic body in society during last several hundred years, corporate autonomy is being reflected by some factor from society necessarily. So, on the basis of this idea—"corporate social responsibility is a self-conscious and moral obligation of corporation ", this chapter studies the idea source of the corporate social responsibility, the reasonable estimation of corporate social responsibility and the reflection of corporate social responsibility on the corporate autonomy. Finally, because corporate autonomy is reflected by the trade association, so, this chapter makes analysis on the basic theory of the trade association, the merits and defects of the trade association, and the limits of corporate autonomy from the trade association.Chapter five—Prospective look upon the future researches and legislation in China aims at some ideas about the theoretical researches and legislation in China of corporate autonomy. This chapter, considering the replying for the economic actuality in China and logical necessity of theory function, firstly examines the idea of corporate autonomy and its limit in China, and points out that on the basis of analyzing, we should change our idea that limit is more important than autonomy. Then we should accept the basic value of autonomy, and emphasize the existence of limits is for the better autonomy, and its main purpose is not to limit the realization of the freedom of corporation, but to active the behaviors of corporation under the background of the harmony of social whole interests. Secondly, by examining the theories and legislations of limit of corporate autonomy, this chapter takes a prospective look upon the future researches and legislation in China, on the basis of that reviewing the existed theory and legal framework.