The CBIRC has launched the outcomes of its first ever evaluation of the company governance of insurance coverage holding teams within the nation. Not one of the teams managed to acquire an ‘A’ rating which is equal to an ‘excellent’ grading.
A complete of 10 insurance coverage teams had been evaluated, of which six acquired a score of ‘B’ (good). The remaining 4 obtained a ‘C’ grade (certified), indicating that there have been some shortcomings of their company governance. The 4 had been China Life Insurance coverage (Group), China United Insurance coverage Group, Sunshine Insurance coverage Group and Huatai Insurance coverage Group.
The best accessible mark within the analysis system is 100 factors. Those that rating from 90 to 100 marks obtain an ‘A’ grade; these with 80 factors to 90 factors are rated ‘B’, these with 70 factors to 80 factors are rated ‘C’ and people with lower than 70 factors are graded ‘D’.
The CBIRC attributed the truth that not one of the insurance coverage teams scored ‘A’ as a result of a number of elements, together with main shareholders’ extreme interference, weak inner danger controls, and lack of an efficient long-term incentive and restraint mechanism.
The regulator says that the insurance coverage teams should take care of 5 issues:
some teams are extremely bureaucratic and their market-oriented mechanism shouldn’t be good;
the administration of shareholders’ rights falls quick, shareholders’ disputes exist, and constraints on shareholder behaviour are urgently wanted;
the core position of the board of administrators has not been absolutely utilised, and there are nonetheless issues akin to extreme intervention by main shareholders;
the administration of firms throughout the group falls quick; there’s a lack of a complete danger compliance administration system;
an efficient long-term incentive and deterrence mechanism has not been established.