On Improvement Of Controlling Shareholders' Fiduciary Duty

The Principle of Capital Majority Rule is an important mechanism for joint-stock company limited,which embodies the principle of equality of capital.However,because of the different number of shares,the shareholders of the Company can be divided into two differentiate groups,the ones with majority shares have the power to control the company, and we call them the controlling shareholder,the other shareholders are in subordinate position.In order to pursue the maximize profits,the controlling shareholders often encroach upon the interests of the company and the other shareholders.In western countries,the fiduciary duty of controlling shareholders was established to prevent controlling shareholders from abusing their power.But in our country,there is not such kind of law regulations,which results in such a situation,on one hand,the controlling shareholders often encroach upon the interest of the minority shareholders,on the other hand,the minority shareholders has no means of protecting their rights.Therefore,how to prevent the controlling shareholder from abusing their power is an important topic in Company Law.This paper starts with the conception of controlling shareholders.The writer uses the positive analysis and the comparative analysis to discuss the theory of fiduciary duty of controlling shareholders.At the end of the article,the writer gives some suggestions on improvement of our legal system.This article is divided into four parts except the introduction and conclusion.Part one is about the content of the fiduciary duty of controlling shareholders and its theoretical basis.In this part,the writer first introduces the provenance and content of the fiduciary duty of controlling shareholders.The legal system was first established in the Anglo-American legal systems,the Civil Law system established the legal system later.The fiduciary duty of shareholders is composed of the duty of loyalty and the duty of care.Then the writer introduces the theoretical basis from three aspects.Part two is about behaviors of breaking fiduciary duty,its harm and classificatory criteria. This part introduces seven kinds of behaviors of the controlling shareholders,it also introduces the results caused by these acts from four different aspects,at the end oft this part, it introduces how to determine behaviors of breaking fiduciary duty and puts forward the writer's points of view. Part three is about the current situation about our country's legal system and its defects. First,it introduces the current situation about the legal system,and then analyses the defects in the system.part four is about measures to improve the current legal system.This part puts forward some suggestions from four aspects,as follows,(1)taking fiduciary duty of shareholder into law,(2)improving voting mechanism of company,(3)configuring the right of independent directors and the supervisory board properly,(4)improving judicial relief system.