What Does a Corporate Controller Do?

The actual controller refers to a person who, although not a shareholder of the company, can actually control the company's actions through investment relations, agreements or other arrangements. In short, the actual controller is a natural person, legal person, or other organization that actually controls a listed company.

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In practice, it is often easy for public investors to know who the controlling shareholder of a listed company is from the annual report of the listed company. However, the actual controller of a listed company is difficult to distinguish in some cases. The actual controller can be the controlling shareholder, or the shareholder of the controlling shareholder, or even other natural persons, legal persons, or other organizations. According to the requirements of the stock exchange, when the information is disclosed, the actual controller of the listed company must ultimately be traced back to the natural person, the state-owned asset management department or other ultimate controller.

For example, the controlling shareholder of a "Delong" listed company may be Delong Group or its controlling subsidiary, but its actual controller can be traced back to natural persons such as Tang Wanxin.

Without knowing who the actual controller of a listed company is, it is difficult to discern related-party transactions manipulated by the actual controller, and it is impossible to make a correct judgment as to whether its related-party transactions are fair and affect the interests of the company and other shareholders. Make investors suffer unnecessary losses.

Because of this, the influence of actual controllers on listed companies has attracted the attention of regulators. From the end of 2001 to the beginning of 2002, regulations such as the "Report on Changes in Shareholdings of Listed Companies' Shareholders" and "Governance Guidelines for Listed Companies" issued by the regulatory authority required that listed companies must disclose the controlling shareholder or actual controller when its controlling shareholder or actual controller changes. Details of the controller. The newly revised annual report standards of the China Securities Regulatory Commission also require listed companies to strictly disclose their actual controllers in order to provide the public with more adequate information. ^[1]