| Summary: | In recent decades, board independence has become high on the agenda of corporate governance reform, resulting in a dramatic change of composition and structure of boards of publicly traded companies. Debate nevertheless continues: the inefficiency of independent directors has been regularly explored by commentators, and the current financial crisis appears to reinforce the doubts about the contribution of board independence. In this thesis, the author stands with independence proponents, firmly backing the movement of encouraging more independent directors to join the boards of listed companies. However, this thesis intends to bring a more systematic analysis, which many previous academic studies have ignored, to a number of questions, e.g. what specific functions are expected of independent directors; how these functions can fit with the unitary board structure; why independent directors are seen as an inherent demand of corporate governance; whether they can be compatible with other governance mechanisms; how their value can be better appreciated; and how mainstream company law is applied to independent directors. On the other hand, the author accepts some critical findings about the difficulties which independent directors face in practice. In response, the author offers a series of solutions, which critics have rarely mentioned, for the purpose of eliminating those obstacles. In general, this dissertation seeks to fuse together two sides of academy, i.e. the advocates and critics of independent directors, and chart a course through which independent directors can better serve the goal of improving the system of corporate governance.
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