Corporate Governance Structure In Multi-principal - Agent Relationship

Corporate governance is regarded as the core of the modem enterprise system, and it is the emphasis of our practice of reform. In the modern corporate governance system, the diversification and scattering of the ownership of shares is one of its main characteristics. Multi-level principal-agency systems among share holder meeting, board of directors and managers realize the separation between ownership and actual control power. Because in principal-agency systems, it always exists information asymmetric problem between client and agent, further more, in Chinese corporate governance system the phenomenon of the " an only big shareholder" is a common sight, and for the reason of imperfection of the mechanism of superintendence and restriction, so the opportunism moral risk caused by information asymmetry and internal person control phenomenon caused by the " an only big shareholder" are very dangerous . This text primarily expatiates institutional evolution in enterprise and corporate governance theoretical development, it goes deep into expatiating the core theory of modern company governance: principal-agency theory. According to Chinese actual circumstance and foreign experience and failure, this paper makes a further description of institutional arrangement of characteristic Chinese corporate governance, and analyses the latent loophole in the institution arrangement of Chinese corporate governance system that lead to opportunism.According to the reasons which cause the invalidity of multi-level principal-agency systems, the paper analyses the latent corrupt practice, and put forward homologous measures to prevent it. By methods of the institution economics and non-institution economics, combining application the methods of property right theories and ethics morality, grasping the roots which cause the invalidity of principal-agency systems, the paper proposes to quicken the paces of reform of property right structure and realize really separation between government and enterprise ,enhances the rule of law commence, connecting the tools of restriction and encouragement, promoting the reforms of political mechanism and economics mechanism synchronous proceeding, consolidates inner and outer superintend mechanism so as to improve corporate governance systems and accelerate economy development of our country smoothly.