Independent Director System In Listed Companies

Development of market-oriented economy accelerates the reform on corporate governance structure. With the trend of globalization of world economy, the mode for operation of corporation in every country is being re-distributed based on practice of the country with reference to that of other countries. The independent director system is one of the models for corporate governance structure reforms, which was created in UK and USA and generalized in the world. It is also performed in our country.In China, analysis and research on history and nature of the independent director system is necessary for constructing a specialized system based on our own practice. In common law countries, the independent director system has become more and more mature after its mandatory and creative beginning. In civil law countries, an inductivity and transplanted system was formed when serious abuse came out from dualistic corporate governance structure. Chinese independent director system is a creative one, which developed step by step under the guidance of some statutory and special independent director rules. Since the independent director system was to some extent absonant with Chinese traditional corporate governance structure, theoreticians had different opinions on whether or not the system shall be introduced into our country, which became a precursor for building of system in this field. With the recognition by newly adopted corporate law, the independent director system is being consummated thereon in China.A reasonable definition on the system shall be precondition for the building. The difference between different countries mainly focuses on legislation. There exist two kinds of legislative models, "hard law" and "soft law" and three expressions, generalized expression, expression by samples and combination of them. Theoretically, the following relationship shall be clarified during identification of independent director: outside and inside director, executive and non-executive director, independent and dependent outside director, independent and dependent non-executive director. Therefore, the independent director refers to the outside director who inspects and is independent from the corporate administration without any trade or relationship with the corporation that may influence its judgement. While...