Recently, with the consent of the Party Central Committee and The State Council, The General Office of the State Council issued the Opinions on the Reform of the Independent Director System of Listed Companies (hereinafter referred to as the Opinions). The Opinions put forward reform measures from eight aspects, including clarifying the responsibilities of independent directors, optimizing the performance mode of independent directors, strengthening the tenure management of independent directors, improving the selection and appointment system of independent directors, strengthening the performance guarantee of independent directors, strictly supervising and managing the performance of independent directors, improving the responsibility restraint mechanism of independent directors, and improving the coordinated and efficient internal and external supervision system. It points out the direction and provides the following for further optimizing the independent director system of listed companies.

The China Securities Regulatory Commission said on April 14 that it will resolutely implement the decision-making and deployment of the Party Central Committee and The State Council, regard the reform of the independent director system of listed companies as an important task to comprehensively deepen the reform of the capital market, and earnestly grasp the implementation of the Opinions. To study well and publicize the "Opinions" as an important task at present, increase policy propaganda efforts, unify ideological understanding, and accurately grasp the spirit and policy requirements of the "Opinions". We have improved the supply of the independent director system, promoted the promulgation of regulations on the supervision and administration of Listed companies, formulated and issued the Measures for the Administration of Independent Directors of Listed Companies, improved supporting systems and rules, systematically standardized the specific requirements of each link of the independent director system, increased supervision and administration over the performance of independent directors, and encouraged independent directors to effectively play their role. Efforts should be made to strengthen cooperation with relevant departments and relevant parties, continuously optimize the policy environment and ecological system, enhance cognition and recognition, gather consensus of all parties, create a good reform environment and a market environment that respects the law and is trustworthy, and promote the sustained, healthy and stable development of the capital market.

The relevant person in charge of the China Securities Regulatory Commission said in a reporter's question on April 14 that the independent director system of listed companies is an important part of the modern enterprise system with Chinese characteristics and an important content of the basic system of the capital market. As an important part of the governance structure of listed companies, the independent director system has played a positive role in promoting the standardized operation of companies, protecting the legitimate rights and interests of small and medium-sized investors, and promoting the healthy and stable development of the capital market. However, with the comprehensive deepening of the reform of the capital market, institutional problems such as the unclear positioning of independent directors, unequal responsibilities and rights, insufficient supervision means, and insufficient performance protection need to be solved, which can no longer meet the inherent requirements of high-quality development of the capital market.

 On the basis of affirming the background, role and significance of the independent director system, the Opinions, in view of the prominent problems existing in the independent director system, make institutional regulations in terms of the status, role, selection, management and supervision of independent directors, so as to make the supervision of independent directors more focused, more optimized functions, more adequate performance protection, more matching responsibilities and rights, and more powerful supervision. It plays an extremely important role in giving full play to the role of independent directors, vigorously improving the quality of listed companies, and accelerating the construction of a standardized, transparent, open, dynamic and resilient capital market.

The relevant person in charge of the China Securities Regulatory Commission said that the "Opinions" in accordance with the principle of seeking truth from facts, the responsibilities of independent directors are both comprehensive and focused, and it is clear that independent directors should perform the duties of directors well, and play the role of participating in decision-making, supervision and checks and balances, and professional consulting in the board of directors, of which the supervisory role is the core goal of the independent director system of listed companies. The Opinions focus on improving the ability of independent directors to perform their duties independently, and propose to improve the system of appointment conditions, nomination and election, continuous management and other links of independent directors. The "Opinions" increase the means for independent directors to perform their duties differently from other directors, promote the shift from individual independent directors to relying on organizations to perform their duties, and further strengthen supervision. The Opinions require listed companies to provide necessary conditions for independent directors to perform their duties in terms of organization, personnel, resources, information and funds.

Managing Editor: Yuan Hao