Internal Governance Of Financial Liberalization Under The Conditions Of Securities Companies In China

Since started from scratch, China's security companies have been growing gradually and have scored obvious achievements through their 20 years of development. Due to mechanism flaws and inborn weaknesses in development environment, security companies, even the security industry are perplexed by internal governance during their development process. This problem hasn't been solved effectively for a long period of time with its pressing aspect unreleased.Corporate governance is crucial to a company's survival and development, while financial opening-up and corporate governance have internal connection and interaction. Financial opening-up has led to changes in corporate governance environment. This will surely result in new problems in corporate governance, which will have direct or indirect impact on financial opening-up. Nowadays, as the transition period of China's entry to WTO was over, the pace of financial opening-up is sure to be further quickened. One of the important reflections is that entry barrier of foreign capital financial organizations will be eliminated step by step, and they will be given preferential treatment. In this circumstance, China's security companies are under great pressure from external world in the following aspects: mechanism environment, risk management, rivalry competition, etc. This has put forward higher requirements for the company to perfect its internal goverance. Only when the internal goverance mechanism of the security companies is being perfected, can we create favorable conditions to adapt to the mechanism environment, strengthen risk management and enhance competitiveness, so that we may meet the changes and challenges brought by financial opening-up calmly and unhurriedly. Solving the internal goverance problems in security companies has become the pressing requirements of enhancing security companies' competitiveness and perfecting the capital market.Seen from the current situation, the internal goverance problems of China's security companies are all-dimensional. This thesis has summarized them in four aspects: stock ownership structure,shareholder committee,board of directors, supervision system, incentive and restricted system and risk management. In author's view, the core issue of security companies' internal goverance in China is aroused by the unreasonable stock ownership structure, the monopoly of state-owned shares in the stock ownership structure in security companies, the serious phenomenon of "too large proportion of state-owned shares" and the lack of circulation. So if we want to settle these problems thoroughly, a key link is to change the stock ownership structure.As the understandings above, the author holds the view that we should improve the internal goverance mechanism in security companies based on the perfection of stock ownership structure by shareholders' committee,board of directors, supervision system, incentive and restricted system and risk management. Through self-perfection in internal goverance, it spurs China's security companies to cope with the new problems and challenges, make efforts to grasp new opportunities brought by financial opening-up and propel security companies and the security industry forward.The thesis is divided into the following 5 chapters:Chapter 1: Introduction. Mainly describe the study background, methods, train of thought and other related conditions of this thesis.Chapter 2: Mainly discuss corporate governance theory, including corporate governance and some related issues, internal and external environment and basic theory of corporate governance; study the positive impact of financial opening-up on corporate governance and new problems that are probably to occur. Thus, lay the theoretic foundation for the following analyses.Chapter 3: Emphatically analyze the present situation and flaws of the internal governance of China's security companies. Point out the primary issue in the current governance of China's security companies is the unreasonable stock ownership structure. Discuss the new challenges that internal governance meets after financial opening-up.Chapter 4: Make comparison between internal governance structure of foreign security companies. Mainly adopt the international comparison method to make description and comparison of governance mode in foreign security companies and gain enlightenment from international experience.Chapter 5: Countermeasures. Combining the study of the previous text and research results by predecessors, make a summary for the perfection of China's security companies' internal governance after financial opening-up and make a systematic exposition in the next 5 aspects: stock ownership structure, shareholders' committee and board of directors, supervision system, incentive and restricted system and risk management, meanwhile, pointing out the primary issue in security companies is the perfection of stock ownership structure and these 5 aspects are an integrity. Only when the internal governance mechanism of the security companies is being perfected, can we cope actively with the new problems and challenges, and seize the new opportunities brought by financial opening-up to push forward the new development of security companies and security industry.The study of this thesis provides essential theoretic preparation and proof analyses for optimizing security companies' governance, which is supposed to improve the governance practice level of China's security companies steadily. We believe the improvement of security companies' governance level will be conducive to the healthy development of China's security industry, to the all-round establishment of modern enterprises' system in China and finally to the all-dimensional opening-up of China's financial industry.