Our Independent Directors Of The Causes And Economic Consequences

As an important measure to perfecting the corporation governance structure, the independent director system has been carried out in China since August, 2001. Many independent directors have entered listed corporations. Therefore, it has become very necessary and urgent to strengthen the positive research on independent director system, especially on the existing reason and the economic consequence (which mostly bases on the correlation between the independent director and the management performance) of the independent director.This paper summarizes the basic aspects of the independent director firstly; Secondly, it retrospects relative research on the existing reason and the economic consequence in China and in other countries. Thirdly, it analyzes the actuality of the independent director in China, including four aspects : the origin, the function, the right and the obligation, the relation between the supervisory board and the independent director; Fourthly , by taking 50 listed corporations in 2003 , using theworld-recognized statistic software-SPSS, analyzing 3 testing models,it studies the relation between the independent director and the management performance and finds that there isn't any obvious correlation between them and that the independent directors have not contributed to the performance improvement of the listed corporations of China as expected; Fifthly, it points the reason of the ineffectiveness of the independent director, involving three aspects: the illegibility of the qualification limit, the defects in the existing independent director system, the lack of the outer environment; Lastly, it gives some advices and countermeasures based on the reason mentioned above of the ineffectiveness of the independent director to facilitate the independent directors' function.