Chinese listed firms show improved governance

The levels of protection being given to shareholders in listed companies in China is improving with the introduction of more mature levels of corporate governance, according to the latest version of annual index.

Li Weian, professor and director of The Research Center of Corporate Governance Nankai University, said the governance and management operation of listed companies in China is "moving forward effectively", but admitted there were still "certain shortcomings" in some areas.

Li added the index showed that the level of protection for small and medium-sized shareholders was still quite low and needed to be improved by setting up further guidelines and supervision.

Li also highlighted the need to combine cash bonuses with methods of refinance to bring more profits to small and medium-sized shareholders.

In addition, Li suggested more efficiency is also needed to be made in the independent director system.

However, the figures showed that overall, the governance index of private-holding listed companies was higher than for State-holding enterprises for the second time since 2011.

Finance and insurance were the two sectors with the highest governance index readings among listed companies.

yuran@chinadaily.com.cn