Design And Research Of H Company's Diversified Equity Scheme

Chinese state-own enterprises have made enormous historic contributions to economic development over the last few decades and still play a vital role there. In recent years, it'has become the focus of management academics to study reformation of state-owned enterprises equity diversification, establishment of modern enterprise system and improvement of the corporate governance structure.In this paper, Shaanxi company H was taken as the study object, its diversification equity program was designed and examined using comprehensively theories of property, modern enterprise system, corporate governance and other related ones with methods of system theory and empirical analysis.Firstly, by analysis on H company's shareholding status, issues as absence of owner in its ownership structure, long principal-agent chain, dominant shareholder were pointed out. It is exactly the unreasonable ownership structure that leads to issues as bureaucrat in director election, dysfunctional of board, and formalization of Supervisory Board, and further more results in more serious problems as majority shareholder's bureaucrat management, chief leader controlling the company and lack of proper business incentive and restrictive mechanism, management's power-orientating thoughts etc.Secondly, according to the company's actual conditions and long-term business development plan, the principle of equity diversification was determined, which included that equity diversification not to affect progress of public listing, maximum financing volume, non state-own investor participation etc. Diversification program was designed, in which non state-own strategy investors, senior management and technical backbones should be introduced in to form a balanced shareholding structure and corporate governance structure with corresponding duties, coordination and effective balance to ensure healthy operation of the company.Finally, supporting measures during the implementation of equity diversification of the company and some other issues related were discussed to ensure smooth practice of the program.It has been concluded in this article that ownership structure is the basis of corporate governance, property right reformation is the core of corporate equity diversification, improvement of internal governance structure is the key to equity diversification, and company equity diversification reformation shall be integrated with its long term development strategy. These conclusions are meant to be reference for state-own enterprises in their equity diversification reformation.