Study On Board Governance Of Modern Company

Board governance is the core and key part of corporate governance. Scientific governance of modern company's Board of directors directly concerns the benefit of company and its shareholders. It has become one of the effective way to promote enterprise quality and to perfect the capital market. Under company management, Board of director is not only the agent of shareholder, but also the principal of management. So, Board of director is very important. Managerial efficiency of modern company's Board of director is not only decide efficiency which Board of director as agent, but also decide managerial efficiency of Board of director as agent. Consequently, it is necessary to combine either aspects and look for and design a scientific system of modern company management to improve whole quality of board of director and promote enterprise healthy development.The structure and the main content:Chapter 1: Theoretical generalization. It begins to requirement of governing board of directors and the paper arranges directional theory of board of directors' management. The paper strengthens recognition of board of directors management, on the other hand, base on absorbing previous research result, the paper provides substantial theory basement for designing board of directors' management. The paper points out the important of board of directors and then, it indicates management theory, expounds and analyses opinion that theory development of modern enterprise promote system of board of directors. At the same time, the paper has discussed that theory of benefit relative used forapplication and evaluating management. At last, the paper summarize the view of board of directors' management research from different direction which western economics and western management, etc. The paper analyses and evaluates these views.Chapter 2: origin and function of the board of directors. Firstly, the paper define that the meaning of board of directors' management is core content of governing a enterprise. Secondly, the paper indicates the thinking of board of directors' management and confirms the necessity and historical significance of board of directors' management according to review origin and development of board of directors. Thirdly, the paper discuss the function of board of directors, propose that it is necessary to analyze the problem of board of directors' management for the board of directors can operate with great efficient. Lastly, base on the previous research, the paper propose a comprehensive analysis program. In connection with the esearch of board of directors' management has unilateral opinion. We combine the two kinds of management that as agent and principal to found a complete system of board of directors' management base on development of governing theory, revolve around some problems that the enterprise make and uphold contract relation, cut down trade expense and pledge harmonious internal management, the system make design and arrangement thus it can be realize scientific decision and effective supervise.Chapter 3: Board governance and its structure. The paper carries out the design to the board of directors about managing structure. The paper designs a theory model of the board of directors of governance structure and aim directly. At the shortage of existent analytical method, it mentions to adopt analytical method of balanced view. On this foundation, the paper carries out a detailed discussion to the board of directors of managing. Include the scale of the board of directors, the leadership power structure of the board of directors. On the basic of the conclusion towards the arguing opinion, adopt analytical method of balance view, the theories explain the relation between the board of directors' management structure characteristic and managing efficiency, and proposed doesn't have a universally applicable of board of directors' management. No matter the scale of board ofdirectors, or the constitute of board of directors, probably have the best level indeed, but this " the best" level possibly decided by lot of complicated factors. On certain the board of directors' management structure. Characteristic not only would influenced by the external factor. Such as structure of stock power, company strategy, the capital market and former accomplishment of the company, but also influenced by the internal factor of board of directors and the characteristic of other boars of directors' management structure.That is to say, there does not exist a simple consequence between the board of directors' management structure and the company accomplishment. The establishment of this consequence in the great degree.We should considered both the external factor and internal factor of the board of directors to decide the board of directors' management structure.Chapter 4: System of Independent Directors. The paper is further perfect to chapter 3, putting forward the frame that independent board of director's system manage. The thesis is carrying on the foundation of the define to the concept of the independent board of directors up, first analyzing the background of independent board of directors system and the path of its evolvement. what is more, it reveals the characteristics of board of directors creation and development; Then, the thesis carries on comb to various standpoint of the independent board of directors system function, putting forward the basic viewpoint, and think that the board of directors system is a kind of system that have the double function, if it implement good, it will rise the huge push function to the management of the business enterprise; Whereas, then may" give support to a tyrant", whether The independent board of directors can develop the positive effect, not only to see whether he improves the company's managing structure but also to see whether the independent board of directors system oneself is perfect or not, and whether the inner part and the exterior circumstance of the business enterprise had the condition that independent board of directors do its function or not and with this related interaction to practice the condition of the system; Immediately after, thesis to the key that independent board of directors produce result- the independence of the independent board director carries on a research, inducing many angle of view of an independent boarddirector's independence from the explanations to the economics of the independent board of directors independence and the law definition; in the End, the thesis carries on the point discussion to the superior choice problem of independent board director's comparison on the basic of preceding research, and get a conclusion: The increment of independent board director's comparison will produce effect of the efficiency of the board of directors, the company board of directors manages a superior choice relation with the comparison of the efficiency and independent board of directors. That simple opinion that the stronger the board of directors independence is, the higher the result of the company's managing efficiency and achievement.Chapter 5: Supervision and stimulation to Board of Directors. As the agent, the Board also engender the agency problem, supervising and encouraging is one of the important methods which can govern the Board. This passage start from the main risk of the Board, pointing out the importance to supervise and encourage the Board; and then it integrating the supervision theory of modern economic and management science, providing the theory support for building the supervising function; at last, directed by above-mentioned theories, it carrying on the system design for the supervision and encouragement function of Board. The supervising function is essential to discuss from discipline of design, separation and balance of the rights of the internal Board and the internal and external supervising to the Board; motivating function is mainly oriented at discussing two aspects: the discipline of design and rewarding function of individual director. In that, making detailed explanation on the rewarding function of individual directors, offering that it is should settle the reward of individual directors on the basis of maintaining the balance of the individual benefits and independence.Chapter 6: Comparison among three typical modes of Board of Directors and its enlightenment, and enlightenment In order to making the system of Board perfect, this passage carrying on a detailed comparison with the models of Board in USA, Japan and Germany, and get the inspiration from it. This unit is make up of 4 parts, the 3 parts in front analyze the feature, frame and function of the 3 models as well as the basis formed by the models from static direction,summarizing the experiences of the models of Board in each country, disclose the 3 main models of the Board depending on the different experience of the economic development of each country, as a result of economics, politics, law, culture and history so many factors in each country. The 4th part make the comprehensive comparison with the 3 models of Board, making analysis of validity and the inclination from the developing view point, offering more experiences and inspirations to the choice of the modern company Board of China.Chapter 7 : Analysis on the problems existing in Board governance of Chinese listed companies and the reasons. The thesis focus the discussion on the problem and the reason administer Chinese listed company's board in details .By analyzing the current situation of administering Chinese listed company's board. Revealed the problem of administering Chinese listed company's board. From the aspect of the independence of the company's director, how to bring into play the independent function of the company 's directors, how to fulfill the action of the company's board .the structure of system about engaging and selecting and prompting the member of company's board, The professional structure of the member, and the operation of her company's board .On the basis of these aspects, the thesis systematically analyzed the reason of these problem, pointed out that the unreasonable structure of the stock rights, lacking of the system of the curious phenomenon of the relevant law and regulation are not perfect are the main cause.Chapter 8: Synthesizing the above analysis, the paper adopt the opinion of system theory, and propose a advice that perfect board of directors in Chinese listed company, For which Chinese economy will turn to another direction. The paper firstly proposes that to the premise that structure of stock power and scientific evaluating system of achievement of board of directors. Secondly, the paper indicates the measure of perfecting board of directors' management in Chinese listed company. Lastly, the paper discusses a set of construction method of board of directors' management from different directions which strengthen restraint of creditor, model culture of governing company, etc.Innovative points of this thesis:1. It defined the concept of the Governance of Board of Directors and its implication. Commencing from the implication of governance, based on the analysis and evaluation of the implication of corporate governance, concept of board governance is been put forward, which is considered to be the core part of corporate governance and within the research field of board governance. It also points out that at the foundation of corporate governance, in order to guarantee scientific and effective decision making of the Board, board governance is a set of mechanism design and institutional arrangement to the board of directors, which is on one side regarded as principal, when structure and operation are concerned, while on the other side regarded as agent, when supervision and stimulation are concerned.2. It proposed an all-sided systematic framework of board governance of modern corporate. Having combined the two roles of board both as principal and agent, we constructed a whole system of board governance, which overcame the shortcomings of current sporadic and exparte research. When as principal, inter-balancing governance structure and scientific decision making mechanism should be formed; when as agent, both "drive" and "prevent" should be put emphasis on. Playing on the platform of the development of corporate governance theory, this whole board governance system covers problems of establishment and maintenance of contract relationship within corporate, transaction cost reduction, assurance of internal management coordination, and accordingly carries on the mechanism designing and institutional arranging, with the aim to obtain scientific decision and effective supervision of the board.3. There's no a valid-everywhere board governance structure. Features of a certain board governance structure are not only influenced by external factors such as share ownership structure, corporate strategy, capital market and previous performance, but also influenced by the features of other board governance structure. Put it in another way, the cause and effect relationship between the features of a certain board governance structure and the corporate performance is not simply existing. To much degree, the existence of this cause and effect relationship relies on other much deeper hidden cause and effect relations. So, establishing the structure of board governance should be based on the generalconsideration of both internal and external factors.4. In a comparatively systematical way, it explored another core problem of board governance—the agency relationship between shareholders and the board, involving its members. As a group which searches for benefit, the board has its own goal function. But it can't and is incapable to fulfill the investment and benefit will of all its stockholders. So, the principal-agency relationship between the board and stockholders should be well dealt with; the board and its members should be effectively supervised and stimulated.5. Starting from needs of human being and combining both stimulation to the executive directors and to the independent directors, designed a theoretical model of stimulation system to the board. It argued that to what degree directors are willing to offer depends on to what degree his needs are satisfied, which are mainly determined by how much of his needs and how strong stimulation is.6. Taking into account of the special background of current Chinese situation as a transitional economy, picking up viewpoints of system theory, this thesis proposed countermeasures and suggestions to prefect board governance of Chinese listed companies.Problems needing further study and research:1. Deeper research of Board governance within the framework of Stakeholders Theory.2. Study on Board governance by ways of Game theory.