Research On The System Of Corporate Equity Donation

China with effect from January1, 2006 implementation of the new Article 5 ofthe Corporation Law, the legality of the clear confirmation of the corporate socialresponsibility that the company has both the for-profit, socially. In the reality of socialand economic life, there are some company’s charitable donation happening. With theimprovement of China’s capital market, the company donated the subject has alreadybroken a simple in-kind and cash, and equity as the subject of donation events.However, because current law does not make the relevant provision of such problems,leading to the embarrassing situation of China companies have donated will not beimplemented, is not conducive to the development of philanthropy in China, alsogreatly discourage donations positive. In this paper, the analysis of equity anddonations, make clearly the corporate equity donation in the legal sense ofinevitability and rationality, and introduced the value of corporate equity donation. Byanalyzing the social realities in China and combining with foreign laws and cases,raising that the corporate equity donation process and oversight mechanisms, tryingto make the company and the community to recognize the advantages of the equitydonation and to accept this new way of donation. This paper puts forward my ownideas and suggestions on the donation system for the corporate equity.In the first of this thesis, the author studies on the overview of the corporateequity donation. There is a brief introduction on the theoretical basis of the corporatedonation and legislative status of corporate donation in China. This chapter leads tothe concept of the corporate equity donation subsequently. This author cleared that theequity could be used as the subject of donation through the analysis of the conceptand nature of equity. Then this author introduced the characteristics and appearance ofcorporate equity donation. Then this thesis focuses on the value of the corporateequity donation. This chapter describes the value for society, companies andphilanthropic foundations. Corporate equity donation can share the responsibility ofthe government, and to make up for some of the inadequacies of existing charities, contribute to social harmony and stability. Companies also own a number of benefitswhen donating. For example, companies could have long-term benefits; saveadvertising cost; get tax concessions. As well as by the philanthropic foundations willcontinue be benefited and get a flexible way to dispose the property. Then this thesisdescribes the corporate equity donation will lead to problem and the solution of thisproblem. This problem is mainly manifested in the company’s management rights.Equity as the subject matter of the donation contains a total of procedural rights,which are useless for charitable institution, and make a waste for the company. Thetransfer of the procedural rights even makes a mess of the company’s managementrights. Our country doesn’t have the laws and the regulations to solve such problemsup to now. This paper proposed the ideas to resolve this issue with foreign cases. Thefourth chapter describes the process of the equity donation. Generated from thecorporate equity donation decision-making, to the change of equity transfer procedure,the choice to the donations of charitable organizations have made in detail. Thischapter is supplemented by case studies presented some problems in reality. In theend of the thesis the author raises oversight mechanisms for the system of corporateequity. For charity, supervision is a top priority, especially when corporate equity is anew way of donation. This chapter describes the areas and methods of supervisionwithin the company, philanthropic foundations and government three perspectives,trying to build a complete, transparent, efficient monitoring system so that thecorporate equity donation could be able to play its due role.Equity donation is a newborn and comprehensive subject. It refers to the scienceof law and economics. Meanwhile, the domestic legal norms in this area are almostblank, and such cases are rare abroad, so this problem is difficult for the author. Theauthor explores the value of corporate equity donation through economic analysis;absorbs foreign experience through contrast; remedies the lack of theory throughcases studies. This author hopes that this article can be useful for the establishment ofthe corporate equity donation system and broad the way that companies fulfill theirsocial responsibilities.