Performance Boundary Of Independent Directors And Rules For Finding Due Diligence

The independent director system has been introduced into China for more than20 years.During this period,independent directors have played an active role in safeguarding the interests of minority shareholders,supervising the behavior of the board of directors and management personnel and improving the governance level of listed companies.However,Kangmei Pharmaceutical case reveals that there are still many problems in the independent director system in China,especially in the performance of duties by independent directors.The responsibilities of independent directors overlap and conflict with those of the board of directors,the board of supervisors and even the management to some extent,which leads to unclear boundaries of independent directors’ performance of duties,thus leading to unclear standards of independent directors’ diligence,which is unfavorable for independent directors to carry out their work and fulfill their obligations.Independent directors are different from ordinary directors in terms of role orientation,duty scope and working methods,so their duty performance methods,performance boundaries and the definition of diligence are also different.Therefore,this paper attempts to discuss the role of independent directors in China’s corporate governance framework,and get the responsibilities and theirs boundaries of independent directors,then discuss what kind of behaviors and performances of independent directors can be regarded as diligent and conscientious,and put forward some suggestions to solve the corresponding problems.According to this idea,this paper is divided into the following four chapters besides the introduction and conclusion.The first chapter gives a brief description of Kangmei Pharmaceutical,and points out the focus of the Kangmei Pharmaceutical case,and then leads to the problems of China’s independent director system reflected in the case,laying the foundation for the following discussion.The second chapter discusses the content of corporate governance structure in some international rules of corporate governance,and then discusses the role orientation of independent directors in America,Britain and Japan under their own corporate governance framework.After that,based on the original intention of introducing this system into China and the problems existing in the corporate governance structure of listed companies in China,the role of independent directors in the corporate governance framework of China and the role they should play are concluded.The third chapter,based on the previous conclusion on the role orientation of independent directors in China,analyzes the distinction and boundary between the responsibilities of independent directors,general directors,board of supervisors and senior managers,and then obtains the scope and boundary of independent directors’ duties.The fourth chapter,based on the previous conclusion on the scope and boundary of independent directors’ duties,analyzes how to judge whether independent directors are diligent and conscientious when performing their duties,and puts forward relevant suggestions for existing problems.