China's Listed Companies Independent Directors And Supervisors Institution Building And Pay Incentives

In recent years,the public-listed companies in China have adopted the Independent Director System,which has played an active role in solving the problems in corporate governance in those companies. But as a newly introduced system in our country,the Independent Director System requires further regularization and improvement.Based on the successful experience of the western countries and the current situation in China,the author put forward a new point of view,i.e. to set up the Independent Supervisor System for Public-listed Companies with Chinese Characteristics and the Compensation Incentive Mechanism for Independent Supervisor in China.The main body of this paper is divided into four parts.In Part One,the author has an overall elaboration of the Independent Director System,including its origination,definition,role and the practices in other countries.Then in Part Two,the author emphasizes the importance of the Independent Director System in our country,and analyzes its development and shortages.A creative point of view is-introduced in Part Three,which is also the core of this paper. The author proposes that the Independent Supervisor System for Public-listed Companies with Chinese Characteristics should be established and developed in our country. The author elaborates the definition,role and function of the system and introduces the methods to establish and improve it.In the last part of this paper,the author further analyzes the important role of the Compensation Incentive Mechanism for Independent Supervisor and its establishment. Emphasis is laid on the discussion about the stock option incentive mechanism.The author combines theories with practices,the experience of the western countries with present condition in China,and expects that the Independent Supervisor System put forward in this paper can be useful for the corporate governance in our country.