The Study On The Corporate Governance Of NCN Co.,Ltd (A State-owned Company) After Reform To Enterprises Of The Composite-Ownership System

The third Plenary Session of the 18th CPC Central Committee CPC Central Committee proposed the development of Enterprises of the Composite-Ownership System(ECOS)economy,there will be conducive to the realization of different ownership capital complementarity.Developing the reform of ECOS is an effective way for state-owned enterprises lasting coruscate vitality.The main object of change in the ECOS reform is the corporate governance structure.The companies,which are preparing for ECOS reform,will definitely collect plenty of related experiences for reference,to improve the feasibility of the restructuring plan,adapt to changes of governance structure smoothly,and shorten the purpose of "run-in period" after the transformation.State-owned enterprises have made some achievements after years of reform and development,but there are still some problems like corporate governance structure and mechanism are not standard,efficiency of operation and rate of return on investment low are very low.This paper did deep analysis and discussion about the ownership structure,corporate governance structure and mechanism for a subsidiary of a central enterprise--NCN Co.,Ltd after its ECOS reform.According the business difficulties of NCN Co.,Ltd which author has been through,as a designer and witness of this ECOS reform,author studied on corporate governance structure optimization research based on NCN Co.,Ltd,came to some universal applicability conclusions.These conclusions have certain realistic value and reference significant for the companies which are in the similar circumstances.Meanwhile,NCN Co.,Ltd uses new model to increase their investment during the restructuring process,the application of this pattern for non-listed ECOS companies' reform has not been discussed and researched by too many scholars yet.Thus,problems which should be solved by this paper are whether corporate governance is able to be improved by the capital increase,and how to improve the corporate governance structure and mechanism.Based on the in-depth and systematic analysis of the reform process and governance structure and governance mechanism after the ECOS reform of NCN Co.,Ltd,this study summed up the main problems of governance structure and governance mechanism after the reform of NCN Co.,Ltd:(1)the ownership structure needs to be optimized,(2)board of directors over check and balance(3)low efficiency of board of supervisors(4)managements lack of effective incentive and restraint.According to the findings above,this paper did a study on optimization scheme of corporate governance structure for NCN Co.,Ltd after ECOS reform:(1)put forward the analysis framework "game trigger mechanism(shareholder activism)-Nash equilibrium(Pareto optimal)-to optimize the corporate governance structure(enhance corporate governance performance)";(2)do quantitative analysis of moderately concentrated ownership structure with shareholder activism;(3)do quantitative analysis of appropriate checks and balances on the board with the Trigger Strategy;(4)research on optimization scheme of the board and management through the practice test.Following conclusions came through above research:(1)if the equity ratio of major shareholder group is less than two-thirds(66.6%),it shows a significant positive correlation with the governance of shareholder activism;(2)if the total number of independent directors and minority shareholders is more than half(50%)of board number,it presents a significant positive correlation with the trigger strategy game;(3)there was positive correlation between the ratio of independent supervisors in the board of supervisors and the supervision effect of board of supervisors;(4)long-term incentive effect is better than the short-term incentive effect to managements.Taking NCN company as the main research object,basing on the ECOS reform of an unlisted secondary company of state-owned enterprises,the above conclusion focus on the impact of corporate governance during the ECOS processing between two largest shareholder which are balance of power,the mainly limitation is reflected in the companies of which the number of shareholders is small,and the shareholding concentration is high.