Abstract: Provisions of the Director Removal System in the current Chinese Company Law are very vague. In particular， there is no clear stipulation on whether directors can be removed by the shareholders without cause before the expiration of their current terms. This is different from the current international legal rules. It also brings a series of challenges to commercial practice and judicial judgment. The 3rd Article of Provisions (Ⅴ) of Judicial Interpretation Concerning the Application of the Company Law has， for the first time， clarified the rules of director removal without any cause. The purpose is to protect the interests of investors and provide judicial guarantee for optimizing business environment. However， the rules are simple and not systematic enough. Especially considering the fact that the minority shareholders of listed companies in China do not vote actively at the shareholders' meeting， further relevant supporting rules， including resolution procedures， judicial decisions， etc.， need to be introduced to prevent the system of director removal from becoming a tool for major shareholders or actual controlling shareholders to infringe upon the interests of minority shareholders， and avoid the occurrence of “rule execution different from what is expected” in practice and other situations.

Key words: business environment, director removal, protecting the interests of minority shareholders, distribution of power of company