The Role of Independent Directors in Chinese Corporate Governance System

2014 Fiscal Year Final Research Report

• Project/Area Number: 24530420
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Research Field: Business administration
• Research Institution: Edogawa University
• Principal Investigator: DONG guangzhe 江戸川大学, 社会学部, 准教授 (50440178)
• Co-Investigator(Kenkyū-buntansha): OHIRA Koji 明治学院大学, 経済学部, 教授 (20152241) ; KANEYAMA Ken 桜美林大学, 経営学研究科, 教授 (40296405)
• Project Period (FY): 2012-04-01 – 2015-03-31
• Keywords: 独立取締役 / 取締役 / 監査役 / 大株主 / 筆頭株主

Outline of Final Research Achievements

In this study the role of independent directors in Chinese companies is investigated. It has been suggested that independent directors have little power to influence the decisions in corporate boards so that large shareholders exploit small shareholders.
In China, crucial issue is conflicting interests among the shareholders. Due to the combination of the concentrated ownership and insider control, minority investors are not protected. Under the Company Law, the independent director system has been formally required. In general, it is not working well.Based on surveys from 150 Chinese listed companies in 2010, the function of its independent directors is explained. On the one hand, judging from three factors such as academic background, career, and age, the independent directors have qualifications for the post. On the other hand, it is hard for them to dissent from the majority’s opinion because the inside directors and auditors are strongly influenced by the dominant shareholders.

Free Research Field

経営学、企業統治論