Research On Optimization Of Board Governance Mechanism Of FD Bank

Local city commercial banks are the special products when the financial industry of our country develops to a certain stage and special financial bodies born for the needs of economic development.Originating from local economy,they are basically rooted in local economy and then serve local economy in return.In the specific trend of economic development,they have made great contributions to the survival and development of local enterprises,the construction of local economy and the macro-control of local government.In recent years,with the rapid development of economy,market mechanism has put forward a requirement of keeping pace with the times to meet market need for the business development of city commercial banks.Under the correct leadership of provincial Party Committee and provincial government,FD bank has continuously expanded its business outlets,opened up capital and customer markets,innovated financial services,and further improved its market share and competitiveness.However,as a special product of economic development,city commercial banks have inherent shortcomings of weak foundation,small scale and poor risk resistance.In the market competition and complex financial environment,to maintain a sustainable and healthy development situation,it is necessary to establish a scientific and effective board governance mechanism.The theory and practice of city commercial banks at home and abroad prove that board governance is a very important management tool in the internal control of banks.An efficient board governance mechanism can improve the performance of banks,promote the quality and efficiency of internal control and reduce financial risks.Its scientific and effective decision-making constantly injects new energy into the development of banks and gradually improves the competition of banks in the market.Therefore,establishing a scientific,effective and perfect board governance mechanism is the key to the sustainable and sound development of banks.As the first officially established local city commercial bank in Yunnan Province,FD Bank,after more than ten years of hard development,has made due contributions to the local construction and development through its overall stable capital operation,continuous improvement of operating performance and steady advancement of business scope.This paper mainly analyses and studies the governance mechanism of FD bank's boards,mainly including the following research contents:The first part is the introduction,in which the background and significance of the topic selection mainly will be elaborated,and the research content and frame work of the article will be summarized.The second part is an overview of the relevant theories about board governance,including the theories related to corporate governance,the particularity of commercial banks,the concepts of directors and independent directors.The third part is board governance mechanism of FD Bank,which will introduce the profile,bank organization,board management system,company salary management System,rules of procedure and information disclosure system of FD band.The fourth part is the problems existing in the board governance mechanism of FD Bank.In this part,the problems existing in the board governance mechanism of FD Bank will be analyzed mainly in three aspects:the first is the problems existing in the senior management(including the unclear boundaries of the functions and responsibilities of the board of directors,the insufficient independence of the board of directors,the imperfect management system of the board of directors,and the disconnection between the professional theoretical knowledge and practical experience of directors.The second aspect is the problems in the salary incentive mechanism(including the imperfect salary incentive mechanism,the macro-intervention of the government,the lack of scientific performance appraisal mechanism,the lack of effective salary management supervision mechanism);the third aspect is the problems in the internal control(including the limited independence of internal governance,the weak independence of internal control departments,etc.).The fifth part of the paper is the optimization scheme of the board governance mechanism of FD bank,including improving the internal governance mechanism of the board of directors and the board of supervisors(strengthening the capacity building of senior management,promoting talent reserve strategy,establishing the accountability mechanism of senior managers,strengthening the performance appraisal of board members,optimizing the configuration of operation and management organization);improving the construction of independent director system(including Strengthen the independence of independent directors in performing their duties,improve the information acquisition mechanism,optimize the salary system and establish the performance appraisal mechanism;improve the incentive and restraint mechanism(innovate and optimize the salary model of senior managers,establish equity incentive mechanism,improve the feedback channels of incentive and restraint mechanism);strengthen internal control(strengthen the construction of internal control system,strengthen risk prevention and control).Ability,strengthening education and training,improving internal audit management system,improving internal inspection and supervision mechanism,safeguarding the legitimate rights and interests of various stakeholders,and clarifying the boundary of governance behavior of local governments.The sixth part is the conclusion.Based on the analysis of the previous parts,this paper will summarize the optimization of the board governance mechanism of FD Bank,with the hope that the results of this study can provide some reference for the board governance of FD Bank to further improve its board governance and achieve its business objectives.