Legal Regulation On The Chinese State-owned Enterprise’s Legal Representatives Reasonable Exercise Their Powers

Although in theory it is clear that the functions of shareholders’, board of directors, board of supervisors and the managers team; But as a result of this is from the original factory director (manager) system reform, the power of the factory director (manager) is equivalent to the power of the board of directors and managers now, if the absence of the competent of the enterprise management, the factory director (manager) to exercise the power of the shareholders, even become the head of a bully, quite a number of our current laws and regulations at the same time the leadership of the legal representative shall bear a lot of responsibility, a lot of the legal representative of the company in the dominant position in the company has not changed, It provides the legal representative of the abuse of the environment.The types of the abuse of power by the legal representative:big decisions without the company’s board of directors deliberation, but by individual decision, caused heavy loss of the company Legal representative of the corruption company assets or accept bribes to cause huge losses misappropriate company funds by the legal representative or legal representative of the company operating the same business, transportation such as upstream and downstream business interest.This paper analyses the causes of the legal representative of the abuse of power, mainly owner do not play fully the role of shareholders in corporate governance, personal authoritarian ideology reflected in corporate governance, it is not clear what is the legal representative duty,and what is the company managers on laws、regulations and the company’s articles.so that half of the legal representative is often personal exercise their functions and powers of the board of directors and managers team possible liability and the result of the equal rights.On the basis of in-depth analysis of the reasons, put forward a proposal for reasonable regulation of the legal representative exercise their functions and powers, including, First, gives citizens shareholder identity in state-owned company, end the absence of shareholders. Citizens play a role of the shareholder’s right of supervision questioned decisions reasonable exercise supervision and legal representative. Through Internet and inquiries on TV.Second, to strengthen the decision of the board of directors and supervisory functions.Directors should have the ability on management and decision making judgment, company director require ability training, reduce the phenomenon of insider control, Set up the special committee of the board of directors, To formulate strict scientific conference board rules and procedures.Third, to reconsider the suitability of the chairman act as legal representative. the duty of legal representative is the company daily management, according to the company law, manager team manage daily operation. The author believes that general manager act as legal representative better than chairman act as legal representative. Chairman is responsible for the company’s strategy and how to supervise the successful implement of the decision of the board of directors of the company.Fourth, to strengthen the company management team construction, At the same time, the legal representative should not be directly in charge of easy corruption department such as finance and purchase and sales. finance and purchase and sales department should charged by other members of the managementFifth, to increase criminal penalties for abuse of power by modifying the criminal law Provide false financial information and particularly significant loss should bear heavy punishment.Sixth, to pursue the liability insurance of legal representative enables companies to avoid destruction and to continue the production and business operation.