According to a recent report on the criminal cases of executives of listed Chinese companies from 2016 to 2017, 261 such individuals were placed under coercive measures, of which more than 100 were sentenced to probation, with very few receiving a prison sentence of more than 10 years.
Executives of listed companies wield great power in corporate management. Any legal violation on their part will result in irreversible losses to their companies, thereby disrupting the securities market at large. Therefore, stringently punishing those who transgress the law is essential to regulating such companies, protecting the interests of investors and promoting the healthy growth of the capital market.
However, in reality, criminal acts committed by corporate executives occur frequently because of light punishments, and many such cases involve huge sums of money.
Although the Criminal Law has a provision for the criminal activity of corporate executives, the country still lacks a complete legal framework of the kind seen in developed countries. Consequently, most convicted senior managers of listed companies are subject only to reprieve or fines which are far less than the economic gains of the crimes.
Therefore, it is necessary to strengthen the punishment of corporate executives who have broken the law by giving longer prison sentences and hefty fines. Only by intimidating criminals with both imprisonment and fines can their illegal activities be brought under control.
(This is an edited excerpt of an article originally published in Legal Daily on August 9)