Zheng Quan Ri Bao Zhi Sheng·2025-06-12 16:47Core Viewpoint - The securities industry is undergoing a systematic restructuring of its corporate governance, with several brokerages announcing the cancellation of their supervisory boards to enhance governance efficiency and structure [1][3]. Group 1: Changes in Corporate Governance - Brokerages such as Guotai Junan and Zhongyuan Securities are eliminating their supervisory boards and establishing audit committees composed of directors to take over the responsibilities previously held by the supervisory boards [1][3]. - The revised Company Law of the People's Republic of China allows joint-stock companies to set up audit committees within the board of directors, exercising the powers of the supervisory board without needing to establish one [2][3]. Group 2: Implementation and Transition - Multiple brokerages have announced plans to cancel their supervisory boards, with Zhongyuan Securities and Hualin Securities already taking steps to do so, indicating a trend among firms to streamline management processes [3]. - The China Securities Regulatory Commission has provided transitional arrangements to ensure that financial institutions implement these changes smoothly by January 1, 2026 [2]. Group 3: Optimization of Governance Structure - The decision to cancel supervisory boards is aimed at optimizing corporate governance structures, reducing overlapping supervisory functions, and enhancing decision-making flexibility [4]. - The audit committees are expected to have a higher level of professionalism compared to traditional supervisory boards, as their members are required to have financial and auditing backgrounds [4]. Group 4: Strengthening Governance Post-Cancellation - Following the cancellation of supervisory boards, brokerages need to enhance their governance in several areas, including establishing a multi-dimensional supervisory mechanism and improving internal audit processes [4]. - It is crucial for brokerages to strengthen the role of independent directors, improve communication with investors, and ensure transparency in information disclosure [4].