On The Consummation Of Supervision System For Chinese Corporation

The supervision system in a company is an in-built component of the modern corporation system. It appears with the disintegration of the corporation's property ownership from the investors' property ownership, directly owing to the disintegration of management and administrative lights from decision-making authority. It aims to control and constrain the acts by the managers and administrators.In modern corporations, the powers of the managers and administrators are further extended. Some corporations have even fallen in the power of some insiders of the corporation so that their power is abused and corruption occurs now and then. How to strengthen the supervision over managers and administrators is a hot topic for those scholars researching into the corporation law.China follows the continental law system. As to corporation law, the function of supervision is realized through a system in which supervision is mainly under the responsibility of the board of supervisors, together with a system of checks and balances between different organs of power in the corporation. However, the board of supervisors' impotence in supervision has imposed a realistic problem on corporations in China. Among many reasons for this, the insanity of corporation law system is one of the most critical. Owing to the influence of traditional corporation theory, which is shareholders dominated and which focuses only on shareholders' interest and mainly protects "capital equality" in the stock system, the corporation is easily subject to the control of some big shareholders or some insiders of the corporation. Therefore, we suggest introducing the system of independent directorate in Anglo-American law system to avoid power abuses and corruption in corporation management. However, how to coordinate the board of supervision and independent...