The Modern Evolution of Corporate Governance Theory——From Shareholder Benefit Maximization to Stakeholder Theory

Corporate governance models in the world can be simply classified into two kinds:shareholder model and stakeholder model. The shareholder model,which aims at maximizing shareholders'benefit has obvious flaw or failure in the inside and outside governance mechanisms of BOD,substantial shareholder and corporate control market.The development of the stakeholder theory brings about the modern evolution of corporate governance theory. Stakeholder theory holds the essence of corporate governance is the integration of the balancing relationships between stakeholders and its goal is the maximization of the value creation for the whole company. Stakeholder model for corporate governance becomes the feasible substitute for the shareholder model.