An Institutional Study On Independent Directors

With technological advances and institutional innovations the corporate form has taken the role of traditional proprietorship or partnership and become the major form of business organization in a modern society. And the study of corporate governance especially the institutional establishments in a corporation has attracted increasing enthusiasm from both academics and policy-makers alike. The investigation is therefore designed to focus on the role of independent directors and their constituency in the corporation; hopefully the new insights the thesis is going to provide may contribute to the existing literature on independent directors issue, and help solve some practical problems in the management of state-owned corporations in our country.Because of the existence of the question of principal-agent, corporate governance has become the focus that the world pays close attention to. In order to solve inside problem who people manage, to reduce the cost of agent and to protect small and medium-sized the interests of investors, the independent director's system arises at the historic moment in U.S.A.. The formulation and development of the independent director's system have been influencing the setting-up and perfection of the independent director's system of our country all the time. Through comparing with the independent director's systems of U.S.A., Britain, Japanese, the experience can be used to meet the needs of our country for reference and offer the feasibility countermeasure for independent director's system of our country.The independent director's system of our country still has a lot of weak points at present: the independent director's qualification of holding a post unclear, "independence" really yet, employing lack of effectiveness, lack of encouragement and tied mechanism. To above-mentioned problems, the independent director's system of our country should strengthen dynamics and build several following aspects: making the independent director's qualification of holding a post clear, enabling working as the qualification legalization; setting up the standard employment and the select mechanism; the accurate appropriate definition "independent character" of the boundary of a piece of land; making the rational remuneration and encouragement scheme, perfecting the tied mechanism.