Li Wei’an: Strengthen cutting-edge research on corporate governance to help the healthy development of capital markets
China’s listed company governance and capital market supervision are core topics that we are concerned about in China’s corporate governance and that constitutional research related work cannot be bypassed.The team I am leading is an earlier academic team for military corporate governance research in China. The Nankai University China Corporate Governance Research Institute was established as the first specialized research organization for military corporate governance research in China.On the basis of theoretical research for decades, it has taken the lead in proposing and organizing the “Chinese Corporate Governance Principles” in China, and established a Chinese corporate governance evaluation system. It has conducted a comprehensive quantitative evaluation of the quality of Chinese listed companies for 17 consecutive years and released the company.The Governance Evaluation Index report and the application of relevant research findings on problems found in corporate and regional corporate governance practices have achieved good results.In itself, revolving around classic cases such as the “Battle of Ten Thousands” and the promotion of the registration system of the Science and Technology Board, it has pushed its corporate governance research and development to a new stage. The “Capital Governance” in front of usLogic is a masterpiece of theoretical and practical analysis around the corporate governance issues that have emerged in the new period.The book is based on the current themes of corporate governance theory and practice. It provides a detailed analysis of traditional governance issues such as board diversity, director responsibility, independent director system, institutional investor participation in corporate governance, and family business governance., At the same time, interdisciplinary analysis and research were conducted from the perspective of law, finance and economics on the dual property rights structure, corporate social responsibility, party building and corporate governance, active shareholders, corporate governance issues in hostile takeovers or other topics that attracted market attention.It can be said that it has both theoretical depth and very “grounding gas”.The most commendable part of the book is the introduction of the latest research on the governance systems, rules and cases of listed companies in Europe and the United States. The related articles introduce the board structure of the European and American listed companies, the special committee system, the treasury stock system, and the design of anti-acquisition terms.Frontier developments such as the revision of corporate governance standards in the United Kingdom and Germany have become important windows for us to understand the frontiers of overseas corporate governance.Combined with the book “Logic of Capital Governance”, I will focus on three points about the future development of Chinese corporate governance.Taking Independence as the Basis of Corporate Governance Effectiveness We have now realized that the key to improving the ability of corporate governance gradually is the effectiveness of governance, and this must first solve the problem of independence as its foundation.First, independence needs to be supported by diversity. It is necessary to continuously improve the shareholding structure, date more diversified shareholders, and avoid “representative” thinking.The main point of governance is to allow multiple stakeholders to play with each other in an open and equal environment and fully express their respective interests in order to achieve a common goal.To take measures, in the decision-making process, all stakeholders should dare to safeguard their own interests and truly participate in governance; it should have more diversified shareholders to participate, so as to develop institutional investors and increase their shareholding ratio ceiling, forming a strong check and balanceOnly with the joint efforts of the parties can we prevent “one share of the dominant” and “one family of the dominant”, and guarantee the independence of the participating parties.Second, the improvement of independence also needs to strengthen the independence of the mechanism design of each agent participating in governance, and cultivate their professional ethics and contract spirit.For example, the selection and appointment of directors must abide by the supervisory procedures, strictly abide by the appointment of the board appointment committee with the majority of independent directors, approved by the board of directors, and then elected by the shareholders’ general meeting;Restricted intervention by major shareholders and managers.The company is “a series of contract unions”, and the spirit of the contract transitions to all parties involved in governance.Third, in order to achieve scientific decision-making, each subject should have a spirit of compromise based on their independence.The goal of corporate governance is not to “check and balance for the sake of checks and balances”, but to achieve scientific decision-making.Each member has independence, participates in the governance game in order to fully express the interests, and maximizes their respective interests in mutual checks and balances; but if they are too obsessed with their own interests and ignore the common interests, they will “tumble” each other.In the “blame”, wasting the fleeting business opportunities or trapping the company in the quagmire of internal struggles, it is up to them to suffer their own losses.Deepening the reform of state-owned enterprises: The core of Chinese enterprise reform in the stage of corporate governance lies in the establishment of a modern enterprise system, which inevitably requires the transformation of administrative governance under the control of government plans to economic governance based on market mechanisms.In 2017, the “Central Enterprise Corporation System Reform Implementation Plan” issued by the State Council General Office embodies the reform ideas of economic governance.Only on this basis can we complete the task of deepening enterprise reform at the group level, remove the residuals of the planned economic system, and make the market play a decisive role in the allocation of resources.With the end of the year, all “enterprises” registered by the state-owned enterprises and local state-owned enterprises in accordance with the enterprise law were restructured into “companies” registered in accordance with the company law.The historical transformation from “enterprise” to “company” once again proves that the fundamental goal of deepening the reform of state-owned enterprises is to realize the transformation from the corporate governance model to the corporate governance model in order to accelerate the formation of an effective governance mechanism and a flexible market-oriented operating mechanism.Corporate governance is the core of the modern corporate system, so deepening the reform of state-owned enterprises is to fully enter a new stage of corporate governance.Actively developing a mixed-ownership economy is a highlight of the Third Plenary Session of the 18th Central Committee of the Party in the field of state-owned asset reform.The role of the development of mixed ownership in governance reform lies in the use of state-owned assets to absorb the vitality of economic governance, and realize the transformation from administrative governance to economic governance.At present, the classification reform of state-owned enterprises has been basically determined, and commercial state-owned enterprises should first explore mixed ownership.In terms of the ownership allocation of mixed ownership enterprises, commercial state-owned enterprises may participate in shares or relatively hold shares, while public-benefit state-owned enterprises may take absolute control first.After clarifying the shareholding ratio of state-owned assets and private assets, it is necessary to carry out market-oriented operations under the framework of economic governance, not just the “one-man” of administrative governance.After rationalizing the equity allocation of state-owned enterprises, the key to the next reform is board governance.Regarding the governance level of the board of directors of China’s listed companies, from the governance evaluation results of 2011 to 2018, the quality of board governance of privately held listed companies has surpassed that of existing listed companies for eight consecutive years.Among them, the governance of the board of directors of state-owned enterprises has been better than that of private enterprises in terms of board operation efficiency and organizational structure, reflecting that state-owned enterprises are better in terms of overall compliance; while private enterprises have been better than state-owned enterprises in terms of directors ‘rights and obligations, directors’ remuneration, etc., reflecting thatPrivate companies are better at inspiring directors to participate in board operations.This can be pruned to further improve the governance of the board of directors of state-owned enterprises. The main purpose is to implement administrative decentralization and authorization to achieve the decision-making and supervision measures of the board of directors; rationalize the governance process and allow the governance mechanism to operate flexibly; enhance the ability of directors to perform their duties and rationalize the incentives for directors, Establish and improve the accountability system for director performance evaluation, and supplement it with an external market reputation mechanism. From the time series of China’s governance reform, corporate governance reform is the first mover.The path of China’s reform is to establish a modern enterprise system, a modern government system, a modern social system, and a modern national system in turn. Correspondingly, it is first corporate governance, then government governance, social governance and national governance; from the perspective of the reform structure, corporate governanceAs an important part of the national governance system, government governance and social organization governance are mutually influential and interdependent.The important problem in the current national governance system is the mismatch of various organizational governance models and governance reforms. Therefore, in order to ensure the deepening of corporate governance reforms, the improvement of the national governance system, the introduction of classified governance and supporting governance reforms are extremely important. Different types of organizations have different functions, positioning and responsibilities, and their own characteristics and laws. Therefore, the governance methods adopted, the governance structure constructed, and the reorganized governance mechanism should conform to the organization’s own governance logic and laws.The reform of classified governance is to use company governance, government governance and social organization governance to manage companies, governments and social organizations respectively.In response to the needs of green development, the formulation of green governance norms has gradually been recognized by the world.The main problem facing the current green development is that it lacks a scale design that leads the overall coordination and coordination of the green development behaviors of all subjects in governance, and will also become a guiding standard for linking green development concepts and practices.Therefore, it is necessary to formulate corresponding governance standards in the context of expanding green governance as soon as possible.After years of research and accumulation, the research team of the China Institute of Corporate Governance took the lead in formulating and publishing the world’s first “Green Governance Guidelines” in 2017.Based on the in-depth analysis and combing of internal environmental protection related literature, laws, regulations and practical cases, using governance thinking to identify governance subjects, from the design point of view to propose a basic framework of green governanceProvide guidance on modeling and collaboration models, etc., and merge from the perspective of governance subjects such as government, enterprises, social organizations and the public.The existing and urgency of formulating and promoting green governance norms from the past is: First, to guide the needs of green development and green transformation in China.The traditional high-energy-consumption and high-pollution development methods have caused severe environmental pollution and excessive consumption of resources, which has also led to insufficient internal motivation for China’s economic growth and development. Green transformation is required to achieve the transformation of development methods and the cultivation of “new kinetic energy”.Second, the need to implement the “Belt and Road” strategy.Chinese companies that implement green governance norms and practice the global view of green governance can create a “green road” that promotes fairness, ecology, and sustainable global economic development.Third, take the lead in striving for the right to speak for international green development.China needs to voice more of its own voice in the formulation of various international standards and win the initiative, so as to develop more right to speak for broad expansion.Fourth, to further promote the need to rebuild the community of human destiny.The concept of green governance is shared globally. The significance of formulating and promoting green governance norms beyond national assessments is the role of the expansion of global governance concepts. It will far exceed the promotion of OECD corporate governance principles for the development of corporate governance in various countries.Finally, congratulations again to Dr. Zeng Bin for the publication of the “Logic of Capital Governance” written by the team of “Legal and Economic Notes”, and is willing to work together for the development and progress of corporate governance in China.□ Li Wei’an (Nankai University Chair Professor, Dean of China Institute of Corporate Governance)