Appointment of a China Supervisor

What is the role of a Supervisor in China?

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In China, a supervisor typically refers to an oversight role within a company's corporate governance structure. The supervisor's primary responsibility is to monitor and supervise the actions of the company's executives, directors, and officers to ensure compliance with laws, regulations, and the company's internal policies.

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Chinese company law mandates the appointment of supervisors in Chinese companies to enhance corporate governance and protect the interests of shareholders. Unlike directors who are involved in the day-to-day management of the company, supervisors focus on overseeing the management's conduct and decisions.

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Small companies can opt not to have supervisors according to the Company Law to be executed on July 1st, 2024. Companies with 300 or more employees should include employee's representatives on the board of directors or in the board of Supervisors.

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Key responsibilities of a Supervisor in China may include:
 

• attending board meetings

• reviewing financial statements

• ensuring compliance with legal and regulatory requirements

• safeguarding the interests of shareholders.
   

Supervisors in China may act as a check and balance to prevent misuse of power or other unethical practices within the company.

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It's important to note that the specific duties and powers of a China supervisor can vary depending on the company's articles of association and relevant regulations. Companies may appoint either an individual supervisor or a board of supervisors, and these individuals are elected by the shareholders.