INDEPENDENT DIRECTORS? SUPERVISORS? WHO SHOULD MONITOR CHINA’S BOARDS?

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Abstract

After the collapse of a number of well-known companies such as Enron and WorldCom, there has been much debate over this is the most effective model of corporate governance in monitoring the board of directors from misconduct: the Anglo-American model of independent directors or the German model of supervisory boards. Most countries have chosen to adopt one either the Anglo-American or the German model. However, the People’s Republic of China (“China”) has adopted both models of corporate governance. This paper seeks to explore the differences between the two models as they apply in China. Further, it examines the challenges which these two models face with regard to their implementation. Finally, an evaluation will be made to ascertain whether the two models encounter the same problems and whether either or both of these two models would be able to effectively monitor Chinese boards.

Keywords: Directors, Independence, Monitoring, China

How to cite this paper: Wang, M. (2006). Independent directors? Supervisors? Who should monitor China’s boards?. Corporate Ownership & Control, 3(2), 142-147. https://doi.org/10.22495/cocv3i2p15