Awakening Governance: The evolution of corporate governance in China

On 24 July 2018, ACGA published a report, titled “Awakening Governance: The evolution of corporate governance in China”. It is an independent and objective review of the development and current state of corporate governance in China. It seeks to explain China’s unique system of corporate governance (CG) to foreign investors and the relevance of emerging global CG best practices to China-listed companies and domestic institutional investors. It contains a series of practical recommendations to regulators, companies and investors for improvement.

The main part of the report examines “CG with Chinese characteristics”. It contains chapters on the role of Party organisations, boards of directors, supervisory boards, independent directors, and audit committees—and challenges facing each. It also examines the similarities and differences between state-owned enterprises (SOEs) and privately owned enterprises (POEs), finding that POEs are more similar to SOEs in governance terms than is often appreciated. Other chapters cover “ESG Reporting and Investing”, “M&A with Chinese characteristics” and case studies on five companies: Sinopec, ICBC, Vanke, Minsheng Bank, and Tencent.

An important feature of “Awakening Governance” is the results of two original surveys carried out by ACGA in Q3 2017, the first on 155 foreign institutional investors and the second on 182 China-listed companies. Further depth is added to the text through a series of interviews with 12 governance experts, directors, board secretaries, investors and others.

治理在觉醒: 中国公司治理进化史