GOME controversy: reflects the Chinese family business governance challenges

GOME shareholder Huang guangyu, led by Chen controversy, the Board of Directors will be held 28 September in the special shareholders ' meeting last seen.

This "two men's influence on summary", has gone far beyond a company's internal game, Chinese family business reflected to the public enterprise transformation of tangled love and hate.

Private enterprise of significant decision-making power in the hands of the who?

The family enterprise in the direction of public enterprises, generally will face the dilemma of the corporate governance structure.

12 September, the Alibaba Group held its sixth session, "West Lake on the sword", lianxiangkongguyouxiangongsi Chuanzhi admits has encountered a problem of management and decision making. In 2007, the CEO of the international master Lenovo management authority, the critic and Yang optimistic about phone business resolutely cut off. LIU Chuanzhi heart did not agree with, "but I only non-executive directors, cannot see no circumstances interfere with other people."

In fact, words in last year's global think tank Summit is turning to IBM, mergers and acquisitions, spent 17.5 billion buy three things really want to buy things, the most important and most valuable is, how the internationalization of the business environment and build a good Board of Directors, as well as handle the Board of Directors and management relations.

Therefore, the words at the time as Lenovo's founder, CEO of decision even if you don't agree with, nor special to intervene on his decision.

So strictly in accordance with the corporate governance rules and private enterprises.

Renmin University of China School of Economics, Professor Li Yi ping in the acceptance of the China Youth daily reporter noted that private enterprises in the start-up of the founder himself at the helm in General is basically is a family enterprise, after the founder often become listed on the major shareholder, to business section control to the Board of Directors. The Board of Directors is responsible only for big shareholder, so in control of the contradiction came out.

It is understood that the United States on the criterion of public enterprise is the largest shareholder in proportion to the possession of the stock is below 30%.

According to this standard, China is still a family holding company. Currently, the major private enterprise decision-making power in the hands of the who? recently, the National Federation of the 2010 China's private enterprises the 500 analysis report shows that in 2009 the interviewed 500 private enterprises, 60% of enterprises choose the "Board", 33% of enterprises choose the "shareholders", aggregate ratio of up to 93%. In addition, 6% of enterprises choose the "Chairman", 1% of enterprise select "President (CEO)".

"From China at present, the Board of Directors in many cases just a form of private enterprise of major decisions or control person of large unit.

"Li Yi-ping said, in General or the enterprise founder or founding family holds the ultimate decision-making power.

Research fellow, Korea Economic Research Institute of Chinese Academy of social sciences Chiu Hwa, Huang guangyu and Chen scramble although intense, but both sides are in accordance with lawful procedures to dispute, can only calculate interests on the other.

In fact in private enterprise governance, because also in the absence of a sound legal system protection problems abound, such as major shareholder violations of minority shareholder interests, family holding companies want to have their small shareholders money ring came to do hit, the transfer of funds to other enterprise it, and so on.

"From family business to public enterprises will have a period of time, we are in the kaner, problems are also very normal.

"CEIBS weijiong, Vice President, business development in Western countries have 100 years of history, many leading enterprises are in development to decades of time really put on the agenda for corporate governance. "It is up to private enterprise governance of it and the personality and entrepreneur, I pushing. ”

Weijiong is Shanghai foshion medical (13.88, 0.21, 1.54%) (Group) co., Ltd. as an independent Director, participated in several of the Board of Directors, he found that the decision of the Board of Directors of the Fortune program comparison of democracy, the atmosphere is very friendly.

He has proposed the introduction of the main business, fosun "because although the merger more fortune, but the main business is not very prominent. The importance of Board members, they are a good listener and thought is also very broad ".

Private enterprise's governance structure to allow enterprises to their decision-making

"A private enterprise, just started building, seven individuals, is simply one person.

"State-owned enterprise reform, Deputy Secretary for the week of release in the direction of the" corporate governance "topic discussions on the different stages of business development, governance structures from simple to complex, this is the rule.

Private enterprises adapt to the kind of governance? the 2010 China's private enterprises the 500 analysis report shows, from the respondents the right type of enterprises holdings and company performance in relation to non-controlling interest in the family enterprise 2009 sales net interest rate 4.85% asset net interest rate 5.79%, slightly higher than the control in the family enterprise 4.38 5.38 percent.

"The difference is smaller and may not be able to explain the problem, but in the long term non-family holdings.

"Weijiong believes that family businesses to public enterprises transition must have twists and turns, but the trend is the general trend of modern enterprise system.

LIU Chuanzhi pointed out that the benefits of a family business is the business owner was passed from generation to download, not good is sometimes nepotism have other drawbacks, we want through culture, through long-term incentive for management itself really work with the owner's State of mind.

"Lenovo such enterprise is to be a family of family enterprises. "For Lenovo company successor issues, key words, is" what do you want to prepare for them, what kind of mechanism to prepare, they will be able to get this done. "

The private enterprise top 500 analysis report found that family holding companies in the coming period will continue to exist, particularly in some sectors and regions, family businesses still have certain management advantage

Enough to strengthen senior management team trust, reduce operating credit risk, accelerate the speed of decision making. But from a holistic perspective, along with the expansion of the scale of enterprises, many private enterprise financing is diverse, there are a lot of enterprise restructuring, non-family-controlled companies took on momentum of development. A collection of private enterprises in all aspects of professional talent and strength of the composition of senior management of the enterprise, and establish a scientific and efficient enterprise management system more conducive to the development and expansion of private enterprises.

"The current prevalence of family businesses have Community macro-system.

"Han Chiu Hwa said that modern enterprise system, shareholders, Board of Directors, the managers have proxy conflicts," If there is no perfect market and the legal system, the introduction of foreign talent, their interests and the interests of the shareholders may not be exactly the same, if not better and governance mechanisms, there will be serious problems, before the agent had Agent transfer the enterprise property. So, should improve the legal system and Manager market, enabling professional managers can grow up as soon as possible. ”

Han chaohua believes that family holdings or non-family holdings cannot be generalized to allow enterprises to its own decision, selection of different enterprise is different, there is no widespread all firms.

Li Yi ping stressed that the development of private enterprises in the form of a how to, ultimately depends on the community legal system, culture and history.

For example, the United States is the social contract, credit and the rule of law are very sophisticated, modern enterprise system is applicable; Japan, Korea's large enterprises were behind the Government's support. The West has many family businesses doing very well, they must use the talent and technology, but family holdings. "Each country's governance structure, a Chinese family business transformation is rooted in our economy, culture, social soil, to see what we the soil suitable for growth. ”