Basis of Mixed Ownership Reform of State-owned Enterprises and the Corporate Governance Mechanism

After the Third Plenary Session of the 18th Central Committee of the Communist Party of China (CPC), comprehensively deepening reform has once again become the main theme of China's political, economic and social development. As an important path to deepen the reform of state-owned enterprises (SOEs), mixed ownership is an exploration and practice aiming at solving the unique problems of the reform of SOEs in China on the premise of maintaining the principal position of state-owned economic entities, with the purpose of stimulating the development vitality of SOEs and striving to solve the problem of low efficiency of state-owned capital by introducing non-state-owned capital. From the economic point of view, the mixed ownership reform of SOEs is a joint venture and cooperation between state-owned shareholders and non-state-owned shareholders. It is a reform of corporate governance model based on mixed ownership reform contract of SOEs and a reset of China's underlying economic logic. In the process of the mixed ownership reform of SOEs, attention should be first paid to the particularity of the interweaving of public and private rights in the contract of the mixed ownership reform of SOEs, which is the basis of the reform. Based on this, special provisions should be made on the public functions undertaken by the mixed-ownership enterprises in the mixed-reform contract of SOEs, that is, the restriction of enterprise control right, the restriction of business freedom, the assumption of public responsibility and the decision-making procedure for "major issues and the use of large amounts of money". At the same time, it is required not only to adhere to the principle of contract freedom, but also to accept the regulation of modern corporate governance system and the rules of state-owned assets supervision by following the market logic. It is also essential to make special provisions on the interests of shareholders and the transfer of shares in the mixed reform contract of SOEs so as to achieve the balance of interests under the interweaving of public and private rights, to build a modern enterprise governance system with Chinese characteristics, to form the best interest arrangement for the mixed ownership reform of SOEs, and to achieve the goal of mixed ownership reform of SOEs, thus improving the efficiency and effectiveness of enterprise management, and enhancing the competitiveness, innovation, control, influence and anti-risk capability of the state-owned economy.