Based on the US Independent Director System-Problems of China's Independent Director System and Countermeasures

Abstract

The independent director system first appeared in the Investment Company Act of the United States in 1940, and the main purpose of the system is to check and supervise the major shareholders and executives of enterprises, while playing a positive role in the normal operation and higher profits of the company. In 2001, the Securities Regulatory Commission of China officially issued the Guidance on the Establishment of Independent Director System in Listed Companies, which also explored the way of independent directors’ the system. China's independent director system was implemented late and it is not mature enough. For example, there are still problems such as lack of independence professionalism of independent directors. Although China belongs to the socialist legal system, which is essentially different from the common law system, the independent director system in China is essentially an imported product, so the independent director system in the United Kingdom and the United States has a strong significance to learn from. This paper compares the current independent directorship in China with that in the U.S. through a controlled variables approach in the hope of drawing substantive suggestions and inspiration. Our proposal is divided into two parts firstly, from the perspective of addressing the independence of independent directors themselves, and then analyzing the possible upgrading of the operating environment of independent directors. In particular, we emphasize the advantages of the U.S. independent director system in terms of comprehensive talent training, selection and recruitment mechanisms, so as to provide implications and solution strategies for Chinese independent director system, in order to improve the role of the Chinese independent director system in corporate governance.