Confucian values and corporate governance : a comparative analysis

Abstract

 The aim of this thesis is to find a fundamental cure to the problems and misconduct of top officers of the listed companies in China. In this pursuit, first, I argue that there are no universal rules applying to all countries, each jurisdiction has its own problems and therefore I look at the particular problems in China and find the solutions that best suit the needs of China. In China, the problems relate to the corporate governance system as well as the bad behavior of individuals and therefore regulation and motivation are really essential according to the agency theory and stewardship theory. But my thesis focuses on the bad apples and suggests ways to improve the malpractice and dishonest behavior of individuals. Given the limitations of law and regulation, the fundamental solution lies in the root of the Chinese culture—Confucianism. I endeavour to demonstrate the relationship between Confucianism and corporate governance, and my thesis is that it is more effective to use Confucianism to influence the Chinese business people than using rules that originate from the West because Confucianism is ingrained in their culture. Lastly, I discuss what aspects of Confucian teachings are appropriate in the corporate world and how they can help directors to be good apples.