Discussion and Analysis of External Corporate Creditors' Protection of Rights and Interests - A Stakeholders Perspective

The limited liability system transfers risk from shareholders to the company creditors. Due to that shareholders participate in company internal governance, the shareholders are often in a dominant position in the company's internal information, while in many cases, creditors are in the environment of information asymmetry, which makes it hard for the interests of the creditors to be fully protected. Therefore, how to achieve the real equal rights and interests between shareholders and creditors? This paper argues that there are three measures to solve this issue, including enhancing the participating degree of creditors in the corporate governance, improving the rights and interests protection system of passive creditors and perfecting the mechanism of credit rating.