Whether small and medium enterprises(SMEs)can have a sustained,rapid and sound development,scientific and sound corporate governance mechanism is one of the crucial factors. This paper is based on the relational contract governance to analyze the family-based governance of domestic SMEs,which comes to a conclusion that SMEs on different development stages shall apply different internal management structures; and then analyzes domestic external governance environment from the perspective of the influence from the bank,capital market and the government. Sum up characteristics of corporate governance in different countries by inspecting corporate governance model of Japan,Germany,Britain,the USA and Italy. Thinking of the differences between SMEs at home and abroad,we find that it's helpful for medium-sized and small enterprises to solve financing difficulty and principal-agent problems and to maintain sound development by developed capital markets,bank shareholding,artificial person's cross shareholding and cluster development of enterprises,and then put forward the corresponding policy proposals. <<