Xin Lang Cai Jing·2025-04-30 05:15Core Viewpoint - The announcement from major Chinese banks regarding the abolition or non-establishment of supervisory boards indicates a significant transformation in the governance structure of the banking sector [1][3]. Group 1: Changes in Governance Structure - Major banks including Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, and Bank of Communications have announced the removal or non-establishment of supervisory boards [1]. - The new Company Law of the People's Republic of China, effective July 2024, allows companies to establish an audit committee within the board of directors, which can perform the functions of a supervisory board [1][3]. - The supervisory board, previously responsible for overseeing financial activities and ensuring compliance, is now optional, with the decision left to the shareholders' meeting [1][3]. Group 2: Implications for Leadership Roles - The cancellation of the supervisory board has led to vacancies in roles traditionally held by the supervisory board chair, often a deputy secretary of the party committee [3]. - Some banks have appointed dedicated deputy secretaries to focus on party-building work, indicating a shift in leadership structure [3]. - The recent resignation of Liu Jin from his position as Vice President of Bank of China, who will now serve as the party committee deputy secretary, reflects these changes [4]. Group 3: Industry Perspectives - There has been considerable discussion within the industry regarding the potential weakening of the supervisory board, with opinions suggesting that the dual system of independent directors and supervisory boards has led to overlapping responsibilities and increased personnel costs [3]. - The National Financial Supervision Administration has clarified that financial institutions can choose to establish an audit committee instead of a supervisory board, further emphasizing the shift in governance practices [3].