Strong shareholders, weak outside investors
| Autor: | Gutiérrez, María, Sáez Lacave, María Isabel, Gutierrez Calderon, Maria Isabel |
|---|---|
| Přispěvatelé: | Ministerio de Economía y Competitividad (España) |
| Rok vydání: | 2018 |
| Předmět: |
Financial system
Indirect approach Economía Competition (economics) Shareholder 0502 economics and business Corporate law Outside investor protection G32 G34 Ownership concentration 040101 forestry Finance Controlled companies Controlling shareholders 050208 finance Corporation law Minority Expropriation Corporate governance business.industry G35 05 social sciences Liability 04 agricultural and veterinary sciences Ownership structure Expropriation 0401 agriculture forestry and fisheries K22 Business Market environment Law Empresa |
| Zdroj: | e-Archivo. Repositorio Institucional de la Universidad Carlos III de Madrid instname |
| DOI: | 10.1080/14735970.2017.1423160 |
| Popis: | In this paper we consider the corporate governance challenges of the protection of outside investors of listed controlled firms. European jurisdictions are supposed to be more veteran and skilled in dealing with these firms, at least in comparison to the American experience. As this article explains, in spite of the regulatory effort that European jurisdictions have made during the last decades, outside investors in European listed firms with controlling shareholders are poorly protected compared to US investors. We trace this problem back to the distinct European approach to the protection of investors based on empowering active shareholders and we are able to explain why in these jurisdictions shareholder protection can be considered high, while outside investors’ protection can be considered low at the same time, i.e. the “strong shareholders-weak outside investors” problem. We analyze the failure of liability, voice and exit measures to protect outside investors from expropriation in these jurisdictions and find that, before these measures can be tightened, it is necessary tackle the inefficiencies in the market environment that make European companies chose complex business structures and operations based on self-dealing. Therefore we argue that an indirect approach, based on fostering competition in the different markets where companies operate, is a necessary complement to any corporate governance reform directly aimed at enhancing the position of outside investors, limiting minority expropriation, reducing the cost of financing for listed European firms and increasing their growth opportunities and value. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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