Research
More independent directors needed in China
More independent directors should be recruited and their
contribution needs to be more valued, according to a research study by
Fudan University in
Shanghai, sponsored by executive search firm
Heidrick & Struggles.
The study found a current tendency among Chinese companies to have weak boards and strong chairmen.
Furthermore, the study revealed that boards tend to be formed
through business or personal networks.
The research also found independent directors' power to
influence chief executive selection is limited, especially as in many companies
the chief executive and chairman roles are combined. Furthermore, native Chinese
companies are resistant to appointing foreigners to their boards.
Heidrick and Struggles welcomed the reforms being pushed
forward by the Chinese government to strengthen boards and boost corporate
governance in state-owned enterprises, arguing these will reduce
the risk of corruption.
Links
Fudan University
Heidrick & Struggles
March 2007 |
