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The Research On The Efficiency Of Independent Directors

Posted on:2005-08-15Degree:MasterType:Thesis
Country:ChinaCandidate:Y Y ChenFull Text:PDF
GTID:2156360125959405Subject:Accounting
Abstract/Summary:PDF Full Text Request
Independent director is one of the important signs that reflect the independence of board of directors. With the system introduced into almost all of the developed security markets, and making the remarkable performance in corporate governance practice, a lot of countries imitate one after another. Following this trend, the securities regulator require the listed companies of our country to set up the independent director system, Since the instruction of setting up independent director system in the listed companies was issued in 2001, the independent director system has begun to develop in our country progressively. People hope it can improve the mechanism of corporate governance, and standardize the operation of listed companies. Accordingly, people pay more attention to its efficiency. Because of these reasons, the paper is trying to make the positive research on the efficiency of the independent director system in the Chinese listed companies. Furthermore, I explained the positive results according to the research combining the facts of Chinese special environment of corporate governance so that it offers the experienced evidence and theory support to the reform of corporate governance in our country.The paper applies positive research method, combined with normative research method. First of all, I introduce the role and the function of independent directors; especially emphasize the status of financial independent director in board of directors. And then I bring forward the research hypothesis based on the former research of others and the facts of Chinese listed companies. Finally, I select 213 listed companies of Shenzhen Stock Market, which has set up the independent director system to carry out the positive analysis and draw the conclusion. The main contribution of the paper is to examine the efficiency of the independent directors and the financial independent directors through studying whether the independent directors restrict the earnings management effectively in the listed companies of our country. However, the experienced research indicates that the independent director system doesn't work very well at present. There are many factors that influence its effectiveness such as the complexity of corporate governance, the defects of independent director system itself and the lack of other suitable governance mechanism. Because of these, Chinese independent director system is supposed to solve these problems that include overlapping function colliding with supervisors, setting up the independent directors associations and improving other suitable governance mechanism, so that the system works effectively.
Keywords/Search Tags:Independent directors, Financial independent directors, Earnings management, Positive research
PDF Full Text Request
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