The Governance Dilemma And Solution Of Chinese Joint Venture Life Insurance Company

Since joining WTO in 2001, China's economy has entered a new stage.China's insurance industry also faces new opportunities at the same time. The great development potential of insurance market in China has won the favor of foreign insurance companies, many foreign insurance companies want to enter the Chinese insurance market. On the one hand, China need learn foreign insurance company's excellent management experience but on the other hand government wants to protect the local insurance industry. Considering about the two factors, the special form of company:the joint venture life insurance company came into being. At present the number of companies accounts for one-third of China's life insurance companies and the joint venture life insurance company has become an important part of China's Insurance industry.Joint venture life insurance company is funded by the Chinese enterprises and foreign insurance companies or financial groups,each company owns half shares of the company, the shareholders of the company has the same ownership and control. Under the background of the joint venture companies, the control conflict between shareholders of the company, imperfect corporate governance structure and different business philosophy, cultural background between two shareholders and other reasons all lead to slow development of joint venture life insurance companies. The joint venture life insurance company came into the governance dilemma because of the special characteristics of equity structure and the form of governance. How to get rid of governance dilemma now has become the focus attention of most joint venture life insurance companies. Firstly, this paper has combed the relevant theories of corporate governance, and take the stakeholder theory of corporate governance as the theoretical basis of insurance corporate governance because it's is more applicable to the real situation of the insurance company. Then this paper gives a detailed description and explanation of the appearance of Chinese joint venture life insurance companies, the problems of Chinese joint venture life insurance companines'development, the 10-years development of Chinese joint venture life insurance companies. Then this paper illustrates the joint venture life insurance real corporate governance issues with combination the stakeholders based corporate governance theory. Lastly paper makes further analysis and illustration by taking ICBC-AXA and Founder Meiji Yasuda Life Insurance as example combining with the theory of corporate governance, then put forward some practical solutions for the governance problems Chinese joint venture life insurance companies face, the practical solutions focus on four aspects:the ownership structure, the directorate systems, the board of supervisors system and the selection and evaluation and incentive mechanism of managers.Main views and contents:The first chapter mainly clarifies the research background, research significance, finishes the summary of literature about the joint venture life insurance company and corporate governance theory. This chapter summarizes the domestic and foreign research status of the joint venture life insurance company and discusses the significance of solving joint venture insurance corporates' governance problems. At last, this chapter expounds the writing ideas, methods, main contents and possible innovation points and deficiencies of the paper.The second chapter mainly lays the theoretical foundation for the thesis writing. Firstly, the theory of corporate governance was simply combed. The connotation of corporate governance is concluded by narrow sense and broad sense. This paper simply analyses the characteristics of two representative international corporate governance models. It is believed that the theory of corporate governance which emphasizes stakeholders'rights and interests is more in line with the reality of insurance corporate governance. This paper takes it as the theoretical basis.The third chapter mainly introduces the general situation of the joint venture life insurance company. Firstly, the joint venture life insurance companies are clearly defined, the generative reasons are expounded. The joint venture life insurance company nearly a decade of development and the present situation is showed by large amounts of data. Finally, the paper summarizes the corporate governance and corporate development problems of the joint venture life insurance companies.The problems existed in Chinese joint venture life insurance company governance is analyses in the fourth chapter. Analysis mainly is about four aspects combining with the relevant theories of corporate governance, the ownership structure, the directorate systems, the board of supervisors system and the selection and evaluation and incentive mechanism of managers. Firstly, there is the ownership issues in joint venture life insurance companies, including equity shareholders led to conflict in the company and shareholders can't make agreement. Secondly, some of the board of directors of the companies are not very professional, the member of the board of directors are uneven distributed and members of the board of directors are assigned by shareholders. Thirdly, most joint venture insurance companies fail to establish the board of supervisors system. Fourthly, the selection mechanism of the joint venture life insurance company managers is not perfect.Chapter five is encountered for the joint venture life insurance company governance dilemma by specific case analysis, this paper selects a representative of two joint venture life insurance company as the analysis object, the two companies are ICBC-AXA and Founder Meiji Yasuda Life Insurance, through the establishment and the equity change of the two companies, operating conditions of the company and corporate governance problems analysis. This chapter deeply analysis the governance issues with specific cases which face by the joint venture life insurance companies.In the sixth chapter, some practical solutions for corporate governance problems are put forward aiming at the analysis in fourth chapter and the fifth chapter.Suggestions are mainly about the ownership structure, the directorate systems, the board of supervisors system and the selection and evaluation and incentive mechanism of managers. Firstly, through the introduction of both the shareholders approved a shareholder and co-management control, the company has two ways to change the ownership structure of equity. Secondly, establish specialized committees of the Board, select Chinese and foreign sides simultaneously recognized professionals as an independent director and three ways to reduce the parent company's impact on the board of directors on. Thirdly, establish and improve the joint venture life insurance company's supervisory system. Fourthly, improve the selection and assessment and incentive system of managers establishing performance-related company manager system.Possible innovative points are in the following three aspects:Firstly, although the joint venture life insurance company is an important component of China's insurance market, its market share is very low and develops slowly. This paper collects development data and the operating status related to life insurance joint venture by yearbook from the insurance, the CIRC official data and information disclosure joint venture life insurance company's official website and other means.Secondly, this paper deeply analyses the joint venture life insurance company governance problems combining with corporate governance theory. Paper analyses the corporate governance problems of two representative company,ICBC-AXA and Founder Meiji Yasuda Life Insurance, and provides a realistic basis for the corporate governance dilemma solutions.Thirdly, the paper expounds corporate governance considering both theory and reality, this paper analyses and study of the joint venture life insurance company through the perspective of corporate governance, focusing on application of research results and practical value. The second chapter collects corporate governance theory, s take the stakeholder theory of corporate governance as the theoretical basis of insurance corporate governance. Chapter ? present situation and development of joint venture life insurance companies in detail. Fourth chapter of summarizes corporate illustrates governance problems in joint venture life insurance companies. The fifth chapter illustrates corporate governance problems by combining actual cases of joint venture life insurance company's problems in depth analysis. Chapter ? puts up specific solutions combining with both theory and reality.