Chaptr 6 Equity Market.ppt

Financial English 湖北经济学院国际金融教研室 孙 玲recle02@ Chapter 6 Equity Market 1.Equity 2.Equity Market What is a company? It is an institution created to conduct business, having independent registered assets, full responsibility of management and profit/loss. Company system is an efficient organizational form for modern enterprise system. While management structure of companys legal body is the core of the company system. Today, state-owned enterprises have set up the management structure of legal body, but it needs to be standardized. ?????????? Share-holding Company Since the stock market is an important component of share-holding system, some basic concepts about share-holding company should be introduced at the beginning of this chapter. Modern share-holding system is consisted of three essentials including share-holding company, stocks, and the stock market. Share-holding Company It is an organizational and property form. With this system, funds and capital could be gathered from different investors by paying company’s share. The raised funds could be allocated and used by the management of company. Also investors are able to get involve with the management of company and the allocation of dividends. Share-holding Company Characteristics of Share-holding The ownership and the management right are separate. The company owners are diversified and changeable. Strong social restriction Organizational Structure Board of Stockholders (BOS) and its authority Operational Policy Investment Plan Candidates of Director and Supervisor coming from Employees Approval of Financial Scheme Resolution on vital events Organizational Structure 2. Board of Directors (BOD) and its authority Convene the meeting of BOS, Decision Execution Formulate all important Schemes about Finance, Operation, Alternation Determine Internal Organizational Structure and Managerial System Organizational Structure 4. Board of Supervisors and its authority Supervise and Inspect Behavi