Governance With Poor Investor Protection
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Governance With Poor Investor Protection
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Author : Paolo Volpin
language : en
Publisher:
Release Date : 2002
Governance With Poor Investor Protection written by Paolo Volpin and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002 with Chief executive officers categories.
Investor Protection And Corporate Governance
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Author : Alberto Chong
language : en
Publisher: Stanford University Press
Release Date : 2007
Investor Protection And Corporate Governance written by Alberto Chong and has been published by Stanford University Press this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with Business & Economics categories.
Análise comparativa sobre corporação, admistração financeira, investimento na América Latina, em especial nos seguintes países: Argentina, Brasil, Chile, Colômbia, México, Venezuela.
Corporate Governance Investor Protection And The Home Bias
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Author : Magnus Dahlquist
language : en
Publisher:
Release Date : 2012
Corporate Governance Investor Protection And The Home Bias written by Magnus Dahlquist and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2012 with categories.
If investors are poorly protected, it is optimal for firms to be closely held because selling shares to minority shareholders is otherwise too expensive. Empirically, most firms in countries with poor investor protection are closely held so that investors cannot hold the market portfolio. We show that the prevalence of closely held firms in countries with poor investor protection explains part of the home bias of U.S. investors. We construct an estimate of the world portfolio of shares available to investors who are not controlling shareholders (the world float portfolio). The world float portfolio differs sharply from the world market portfolio. In regressions explaining the portfolio weights of U.S. investors, the world float portfolio has a positive significant coefficient but the world market portfolio has no additional explanatory power. This result holds when we control for country characteristics. An analysis of foreign investor holdings at the firm level for Sweden confirms the importance of the float portfolio as a determinant of these holdings.
Investor Protection And Corporate Governance
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Author : Mark L. DeFond
language : en
Publisher:
Release Date : 2007
Investor Protection And Corporate Governance written by Mark L. DeFond and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.
Recent research asserts that an essential feature of good corporate governance is strong investor protection, where investor protection is defined as both (1) the extent of the laws that protect investors' rights and (2) the strength of the legal institutions that facilitate law enforcement. The purpose of this study is to test whether the two components of investor protection are associated with an important role of good corporate governance: identifying and terminating poorly performing CEOs. Our tests find no relation between CEO turnover and firm performance in countries with extensive laws protecting investors. However, we find that CEO turnover is associated with poor firm performance in countries with strong law enforcement institutions. We also find that in countries with strong law enforcement, CEO turnover is associated with poor stock returns when stock prices are more informative, and with poor earnings otherwise. Further, our findings are robust to controlling for the influence of public opinion, the effects of block-holders, the level of financial market development, a country's legal origin, and several alternative research design specifications.Our results suggest that strong law enforcement institutions are important in fostering corporate governance mechanisms that eliminate unfit CEOs, but that extensive laws are not. This finding is consistent with: (1) limited investor protection laws being capable of cultivating good corporate governance as long as law enforcement institutions are strong; and (2) insiders (including directors and CEOs) in countries with weak law enforcement being more likely to engage in collusive behavior to expropriate shareholder wealth, thereby reducing directors' incentives to dismiss poorly performing CEOs. More generally these findings suggest that good corporate governance requires law enforcement institutions capable of protecting shareholders' property rights (i.e. protecting shareholders from expropriation by insiders), but does not require extensive shareholder protection laws.
Corporate Governance Investor Protection And Performance In Emerging Markets
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Author : Leora Klapper
language : en
Publisher:
Release Date : 2002
Corporate Governance Investor Protection And Performance In Emerging Markets written by Leora Klapper and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002 with Business enterprises categories.
Corporate Governance And The Shareholder Base
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Author : Karl Lins
language : en
Publisher:
Release Date : 2004
Corporate Governance And The Shareholder Base written by Karl Lins and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2004 with Corporate governance categories.
"This paper uses a sample of 4,410 firms from 29 countries to investigate the relation between corporate governance and the shareholder base. In contrast to previous work, our results strongly support the notion that poor corporate governance, at both the firm and country level, negatively impacts the willingness of foreign investors to hold a firm's equity. Specifically, we find that firms whose managers have sufficiently high control rights that they may reasonably be expected to expropriate minority equity investors attract significantly less U.S. investment, especially in countries with poor external governance. Our findings suggest that the prices U.S. investors are asked to pay for firms with poor governance are not low enough to fully compensate them for expected expropriation or increased estimation risk associated with expected poor disclosure by these firms. Because prior research shows that a smaller shareholder base is associated with a lower firm value, our results are consistent with the notion that the shareholder base represents an important channel through which poor expected corporate governance contributes to a reduction in firm value"--Federal Reserve Board web site.
Re Envisioning The Controlling Shareholder Regime
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Author : Sang Yop Kang
language : en
Publisher:
Release Date : 2016
Re Envisioning The Controlling Shareholder Regime written by Sang Yop Kang and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2016 with categories.
In his article, Controlling Family Shareholders in Developing Countries: Anchoring Relational Exchange, Professor Ronald Gilson raises critical points against the conventional view of corporate governance in a controlling shareholder regime with poor investor protection: (1) given that equity financing is much more expensive to a corporation than debt financing due to the reinforced pecking order of corporate finance in a bad law jurisdiction, why do some controlling shareholders nonetheless have so many minority shareholders through new equity issuances? (“Gilson's riddle”); and (2) if laws are inefficient and do not protect investors, as the conventional view explains, why do minority shareholders still invest their money in controlled corporations? (the “flipside of Gilson's riddle”). In order to answer these conundrums, Professor Gilson himself proposes a potential -- but partial -- solution namely the product market-based account (PMBA). Against this backdrop, I begin with a critical review of the PMBA. Then, I propose alternative solutions to the PMBA for corporate governance conundrums. As for Gilson's riddle, I analyze how a controlling shareholder can gain both pecuniary and non-pecuniary benefits by having more minority shareholders through equity financing (despite deep discount on equity securities). As for the flipside of Gilson's riddle, I explain why minority shareholders tolerate a controlling shareholder's expropriation, and how they can gain benefits through capital market transactions that can compensate for insufficient investor protection. Consequently, I show that both a controlling shareholder and minority shareholders -- as a seller and purchasers in a capital market -- accept market terms and conditions because their interwoven relationship creates symbiosis and a mutual hostage situation. In such cases, their cooperation is compelled and strengthened, and economic development ensues. That relationship explains why some bad-law countries have functional capital markets -- an anomalous result from the standpoint of the conventional view.
Rethinking Corporate Governance
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Author : Alessio Pacces
language : en
Publisher: Routledge
Release Date : 2013-01-17
Rethinking Corporate Governance written by Alessio Pacces and has been published by Routledge this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013-01-17 with Law categories.
The standard approach to the legal foundations of corporate governance is based on the view that corporate law promotes separation of ownership and control by protecting non-controlling shareholders from expropriation. This book takes a broader perspective by showing that investor protection is a necessary, but not sufficient, legal condition for the efficient separation of ownership and control. Supporting the control powers of managers or controlling shareholders is as important as protecting investors from the abuse of these powers. Rethinking Corporate Governance reappraises the existing framework for the economic analysis of corporate law based on three categories of private benefits of control. Some of these benefits are not necessarily bad for corporate governance. The areas of law mainly affecting private benefits of control – including the distribution of corporate powers, self-dealing, and takeover regulation – are analyzed in five jurisdictions, namely the US, the UK, Italy, Sweden, and the Netherlands. Not only does this approach to corporate law explain separation of ownership and control better than just investor protection; it also suggests that the law can improve the efficiency of corporate governance by allowing non-controlling shareholders to be less powerful.
Investor Protection And The Transfer Of Corporate Control
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Author : Nhut H. Nguyen
language : en
Publisher:
Release Date : 2008
Investor Protection And The Transfer Of Corporate Control written by Nhut H. Nguyen and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2008 with categories.
In this paper, I use a sample of completed control transfers for listed firms from 1990 through 2003 to examine the relation between investor protection and the choice of acquisition form across 49 countries. I find that the proportion of partial acquisitions (as opposed to full acquisitions) is negatively correlated with the degree of investor protection in the target country. That is, acquirers are more likely to bid for a fraction of the target's equity if legal protection of investor rights is poor in the target country. My results hold for all deals and deals that involve foreign acquirers. In addition, I find that foreign acquirers are more likely to be involved in partial acquisitions than in mergers of domestic targets if they are from countries with weak investor protection. Finally, my results show that given the degree of investor protection in the target country, a deal is more likely a partial acquisition if the target firm's corporate governance is poor.
Corporate Governance And Risk Taking
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Author :
language : en
Publisher:
Release Date : 2007
Corporate Governance And Risk Taking written by and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.