Professional Farmers Cooperatives Corporate Governance Structure

The farmer specialized cooperating movement has revived quickly in recent years in China, and due to the want of legal protection it is difficult to develop healthily. How to improve the farmer specialized cooperative governing structure has the vital significance to the farmer cooperative's regulation and operation.The farmer specialized cooperative is an autonomous organization of production management which is composed of voluntary farmers and is based on the idea of mutual benefits. Although the farmer specialized cooperative is an organization of production management, it is different from that of company in the aspects of seeking profits and rights of its members. It is also different from that of collective economic organization in the cause of origin, aims and its membership demarcation. The farmer specialized cooperative is a special organization which is neither totally the same as company nor the same as collective economic organization. To recognize its particularity is the premise and foundation that guarantees the rules being arranged scientifically and reasonably. The thesis compares the property rights relation, and their inner govemance mechanisms such as motivation, control and decision between the farmer specialized cooperative and cooperation. Facing the economical marketability, the farmer cooperative unique property right system make the intrinsic conflict between the member's democratic control and the specialized management, which was solved effective by the balance between the law and the self-govemance.The thesis research demonstrates the goveming structures and problems of the farmer cooperative in China by means of sampling and investigating. What we've found are problems such as: intervened by government; the lack of member's democratic control and supervisory in cooperative governing structure and incomplete watchdog mechanism and so on. The causes of theses problems lies in both Inside the farmer cooperative itself and the market environment, as well as in such external factors as management system, politics and legal environment.Governing mode of the farmer specialized cooperative should be multiform, but no matter what forms, they must be effective, balanced, and with good adaptability. A new way to improved structure of farmer specialized cooperative lies in the construction of the balance between democracy control of the member of cooperative and the management specialization, and lies in the balance between law and self-governance, as well as the establishment of a mechanism to encourage and restrain the goveming centered by executives. In addition, policies and laws should be made to allow to further modify and stipulate terms of governing structures in the Farmer Specialized Cooperative Law, and to establish regulations on goveming the farmer specialized cooperatives. To ensure the objectivity of supervision, the responsibilities for registration and supervision of cooperatives should be separated from responsibilities for supporting them. Standardized accounting practices and reporting systems should be applied in the operation of cooperatives, including a requirement for financial reports.