Study On Governance Structure Of State-owned Investment Company

Along with the development of economy, establishment of modern enterprise system, the main feature is"clear property right, definite power and duty, setting apart the government and the entity enterprise, and scientific", is becoming the target of the business enterprise reform. Corporate Governance is the core of modern business enterprise system. It can ensure the enterprise to make decisions scientifically and thus it can improve the enterprise's management efficiency and its performance. Good Corporate Governance is necessity for enterprise's existence and development. So it's very important.The State-owned Investment Company is the result of national property management system reform. Under the new"three level"management system, national property management organization -state owned property operation company-state owned entity business enterprise, Investment Company actually plays the role of second floor. Investment Company is the"Isolation Zone"between the government and the entity enterprise, so its existence is conducive to depart the government and state owned business enterprise. As the representative of national property, its existence will help implement the operation duty of national property; it's also helpful to adjust the structure of national economy and heighten the control power of national economy. So the Investment Company will play a very important part in the new system. But first of all, it must improve its Corporate Governance.The essence of Corporate Governance is to deal with agency problems which result from separation of proprietary rights from management rights. Because Investment Company is placed in the middle link of the nation's investment system, it has complex principal-agency relationship. There is complicate principal-agency relationship between the government and Investment Company, the Investment Company and the entity enterprise, and in Investment Company itself. So it must be handled carefully, otherwise the national property will be washed away. In one word, it's very necessary to study how to perfect the Investment Company's Corporate Governance.Through the development for more than ten years, State owned Investment Company has fulfilled corporate system reform and build up corporate governance structure initially, which covers the board of director ,supervisor the managers. But at present its governance mechanism is not complete. It has problems as follows: (1)The government interferes excessively, and the independence of the board of directors isn't strong thus result in low efficiency of the board of directors.(2)Supervisor lacks over a long time, and existing supervisor mechanism has certain blemish. (3)Lacking valid incite and binding mechanism to agent. (4)Existing quite serious internal person controls problem.These existent problems have already influenced Investment Company's management efficiency seriously and done harm to keep and increase the value of national property. So improving its governance is the urgent matter at this moment. Firstly, push forward marketization reformation so as to build system foundation for Corporate Governance. This can be achieved by:①standalizing the government's behavior and building up compensation mechanism;②standalizing State-owned Property Management Council's management and heighten its operation ability.③pushing forward share diversification reform strongly and perfecting its corporate mechanism reform.Secondly, the design of inner governance mechanism is also very important. This covers not only making clear each responsibility of the board of shareholders, the board of directors, the board of supervisors and managers, but also its governance to subsidiary and building property representative system. As far as the board of directors is concerned, we should:①make clear its and its member's responsibility and authorities, and let related people undertake the duty②increases the amount of exterior director and independent director, and make them more professional③perfect evaluation system to director, and let the unqualified directors out.④builds up information public system to director, and ensure them to acquire full valid information.The board of supervisor also plays a very important role in the Corporate Governance. In order to change its invalidity present state, the supervision right should be handed out from State-owned Property Management Council to other organization, which is subordinate to People's Congress directly. At the same time, we should pay attention to its independence and specialty.The general approach to set up to stipulation-restrain mechanism to agent is: let residual control power mate with residual claimant, and make the supervisors'and managers'benefits to establish link with the corporate performance. Refrain mechanism covers two aspects. One is exterior refrain including competitive Capital Market, Managers Market, and Product Market. Another is internal refrain which is based on the function of the board of directors and supervisors. Stipulation should include material and mental award. We should speed up the experimental unit and the expansion of the salary system of year.Finally, the exterior go environment should be improved and make use of the exterior competitive market to improve the Corporate Governance. It mainly includes Capital Market, Managers Market, and Product Market. The exterior governance plays its role through inner governance, but its function can't be acted for.