The Study On Exercising Of Institutional Investors' Voting Right In China's Public Corporations

At the end of 2015,Baoneng,a capital group that was not so famous at that time,made a name rapidly by purchasing a large number of stocks and became the first substantial shareholder of Vanke.The management of Vanke showed their dislike to this uninvited guest,and spared no efforts to take away Baoneng's control power in Vanke.This battle is not completely over until now,and it triggered a conflict between institutional investors and industrial corporations.In theoretical research,the positive role of institutional investors in corporate governance has a lot of proof,but emerging events of the securities market makes institutional investors "barbarians".From the perspective of exercising of institutional investors' voting right in China's public corporation,this article aims to perfect the system of the exercise of institutional investors' voting right,so that promoting the combination of capital and industry to a win-win situation.The first chapter of this article is about the particularity of the exercise of the voting right.Comparedwithother shareholders of listed companies,the difference mainly lies in the fact that the exercise of institutional investors is more professional.What's more,due to the existence of double principal-agent relationship,institutional investors should vote under a fiduciary duty to maximize the interests of others rather than to maximize their own interests.In the second chapter,firstly,this articledemonstrates that the institutional investors show a new trend to participate corporate governance more positively.Secondly,this tendencyis bringing positive influence and negative impact,and at least in the level of public opinion,negative effect attracted more attention and worries.Therefore,choosing the negative effect as the focal point,this chapter then find out that the conflict between investment objectives of institutional investors and development goals of public corporations,the defect of institutional investors' internal mechanism andthe lack of professional attitude and skills in institutional investors,is the cause of that negative effect.Finally,on the basis of the above,this paper tries to puts forward some proposals to perfect the related system in our country.The perfection of system is divided into two parts,the first part,namely the third chapter,is from a relatively macroscopic level.It put forward an overall route to exercise the voting rights for institutional investors of listed companies in our country,which is to build a voting system of normative principles and guidelines.The problem of goal conflict and the internal mechanism of institutional investors cannot be completely eliminated.However,through this voting system,on the one hand,it can lead institutional investors to act more rationally and to actively participate in corporate governance,so as to mitigate the conflict of interest;On the other hand,it can make more powerful constraints on the behavior of institutional investors,as far as possible,to avoid the risk caused by the defective internal mechanism.In addition,the voting system can greatly increase institutional investors' subjective initiative in a considerable flexible way.Once agood profession autonomy is formed,it can greatly reduce the regulatory costs,and promote the healthy development of institutional investors' exercise of voting right.The second part of the system perfection is from a relatively microscopic level,focusing on the problem of insufficient professionalism in China.It's the introduction of proxy advisory mechanism.Proxy advisors are with professionalism and independence,which is beneficial to the specialization of exercising the voting rights and to the balance of all parties' interests.As for the design,first of all,it is necessary to define the legal obligation of institutional investors to exercise their voting rights,so as to improve the regulatory pressure;At the same time,the construction and evaluation of professional institutions should begin.The combination of two measures will promote the growth of the professional institutions.Finally,a settlement mechanism to solve some possible conflict of interest is necessary,so that the independence of the exercise of voting right and the balance of the interests of all could be ensured.