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The Chinese Company Dilemma - Page 5 PDF Print E-mail
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The Chinese Company Dilemma
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CONCLUSION.  
This is a particularly crucial time for Chinese businesses listed on the U.S. stock exchanges. With a deeper understanding of investor communications, Chinese companies will be able to better appreciate business transparency, compliance and investor relations as powerful tools with which to succeed within both local and international financial markets. Additionally, listed enterprises from China in the U.S. need to learn more about the rapidly expanding and demanding financial frameworks of corporate governance and financial disclosure within the U.S. regulatory system. As one of the important financial regulators in China, the Shenzhen Stock Exchange has been commissioned to foster corporate governance and standardization in investor relation management of domestically listed companies. Although this initiative has yet to show rewards, the importance of this type of infrastructure to the Chinese exchange is paramount and its proper administration is necessary for the success of Chinese corporations. Likewise, Chinese businesses listed in the U.S. need to take heed of the policies implemented by the Shenzhen Stock Exchange and apply them to their corporate regulations regarding their U.S. listings.
 
Further, the development of communication technology (i.e. the internet and mobile communication), the globalization of the world economy, and the changes to people's investment concepts -- particularly in light of recent economic decline worldwide, have collectively produced an investment framework requiring  listed companies to attach great importance to their investors in order to continue to grow their investment wealth. Chinese companies must also realize that a long and stable relationship with their shareholders is necessary to enhance financing channels and to sustain development within the public markets.

Finally, the rapid expansion of Chinese enterprises and the shortage of experienced executives within the system (especially possessing an in depth understanding of the U.S. markets) have amplified the importance for foreign experts to intervene and provide experienced financial management and structure to Chinese companies. This gap may be bridged though consultancy or by interim employment of western professionals to Chinese businesses. Just as it is undeniable that one of China’s greatest assets is its 1.3 billion people -- making up its vast labor force, it is equally undeniable that one of the U.S.’s greatest assets is also its people – including experienced and qualified management executives, founded on education, a free market system, and social economic maturity. As the U.S. has outsourced its manufacturing needs to China, Chinese business owners should look to engage the U.S. management workforce as a repository for skilled corporate executives in order to assimilate into the Western standard of business conduct.

 



 

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