The Corporate Governance Industry (original) (raw)
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The State of Corporate Governance 2004
The U.S. corporate governance system has recently been heavily criticized, largely as a result of failures at Enron, WorldCom, Tyco and some other prominent companies. Those failures and criticisms, in turn, have served as catalysts for legislative change (Sarbanes-Oxley Act of 2002) and regulatory change (new corporate governance listing standards from the NYSE and NASDAQ). In this paper, we consider two questions. First, is it clear that the U.S. system has performed that poorly; is it really that bad? Second, will the changes lead to an improved U.S. corporate governance system? We first note that the broad evidence is not consistent with a failed U.S. system. The U.S. economy and stock market have performed well both on an absolute basis and relative to other countries over the past two decades. And the U.S. stock market continued to outperform other broad indices after the scandals broke. Our interpretation of the evidence is that while parts of the U.S. corporate governance system failed under the exceptional strain of the 1990s, the overall system, which includes oversight by the public and the government, reacted quickly to address the problems. We then consider the effects that the legislative, regulatory, and market responses are likely to have in the near future. Our assessment is that they are likely to make a good system better, though there is a danger of overreacting to extreme events.
THE STATE OF U.S. CORPORATE GOVERNANCE: WHAT'S RIGHT AND WHAT'S WRONG?
Journal of Applied Corporate Finance, 2003
The U.S. corporate governance system has recently been heavily criticized, largely as a result of failures at Enron, WorldCom, Tyco and some other prominent companies. Those failures and criticisms, in turn, have served as catalysts for legislative change (Sarbanes-Oxley Act of 2002) and regulatory change (new governance guidelines from the NYSE and NASDAQ). In this paper, we consider two questions. First, is it clear that the U.S. system has performed that poorly; is it really that bad? Second, will the changes lead to an improved U.S. corporate governance system? We fi rst note that the broad evidence is not consistent with a failed U.S. system. The U.S. economy and stock market have performed well both on an absolute basis and relative to other countries over the past two decades. And the U.S. stock market has continued to outperform other broad indices since the scandals broke. Our interpretation of the evidence is that while parts of the U.S. corporate governance system failed under the exceptional strain of the 1990s, the overall system, which includes oversight by the public and the government, reacted quickly to address the problems. We then consider the effects that the legislative, regulatory, and market responses are likely to have in the near future. Our assessment is that they are likely to make a good system better, though there is a danger of overreacting to extreme events.
2. The State of U.S. Corporate Governance: What’s Right and What’s Wrong?
Columbia University Press eBooks, 2009
The U.S. corporate governance system has recently been heavily criticized, largely as a result of failures at Enron, WorldCom, Tyco and some other prominent companies. Those failures and criticisms, in turn, have served as catalysts for legislative change (Sarbanes-Oxley Act of 2002) and regulatory change (new governance guidelines from the NYSE and NASDAQ). In this paper, we consider two questions. First, is it clear that the U.S. system has performed that poorly; is it really that bad? Second, will the changes lead to an improved U.S. corporate governance system? We first note that the broad evidence is not consistent with a failed U.S. system. The U.S. economy and stock market have performed well both on an absolute basis and relative to other countries over the past two decades. And the U.S. stock market has continued to outperform other broad indices since the scandals broke. Our interpretation of the evidence is that while parts of the U.S. corporate governance system failed under the exceptional strain of the 1990s, the overall system, which includes oversight by the public and the government, reacted quickly to address the problems. We then consider the effects that the legislative, regulatory, and market responses are likely to have in the near future. Our assessment is that they are likely to make a good system better, though there is a danger of overreacting to extreme events.
On the uses of corporate governance provisions
Journal of Corporate Finance, 1998
We document a large and broad-based increase in the use of corporate governance provisions in the late 1980s. As a result, most large publicly traded firms have complex governance structures. This violates an assumption implicit in many empirical studies that provision use is mutually independent. While overall provision use is not systematically related to industry grouping, the uses of some types of provisions are correlated. Most notably, supermajority vote requirements, classified boards, and shareholder meeting requirements tend to be used in concert. Firms reincorporating to Delaware tend to eliminate cumulative voting, and coverages by certain types of state antitakeover laws are correlated. We also find that firms with poison pills tend to have relatively high institutional ownership, low managerial ownership, and a high proportion of independent directors.
A review of regulatory enforcement, corporate governance and market reactions
AFRICAN JOURNAL OF BUSINESS MANAGEMENT, 2011
The past decades witnessed the massive growth of literature on corporate governance. Various perspectives of corporate governance mechanisms were widely documented. However, studies on corporate governance from the regulatory perspective receive relatively little attention. Majority review papers focus largely on internal and external corporate governance mechanism literatures. This paper intends to give an overview on the literatures on the second generation of corporate governance research as suggested by Denis and McConnell. Literatures on legal and regulatory mechanism are reviewed. In addition, this paper highlighted the roles and importance of regulatory investor protection, regulatory enforcement and compliance behavior. The consequences of corporate misconduct and stock market reactions followed by identification of research gap and suggestions for future research are discussed.
Corporate Governance Regulation, Chapter 1 Introduction
2016
È rn c o FJ F z z o ln F ln ô q r. = c z to m m -l -.1 z m v Ð o c o o-(o o ¿n ¡nforma busin€ss lsBN 978-1 -1 38-90999-1 ,lllxillluullilililil]1ll CORPORATE GOVERNANCE RE GIJLATION -fIIIi ('IIAN(;IN(J ROI,I.]S AND RIISPONSIBILI]'IES OIì I OARI)S OI.'DIRTJCTORS ALICE KLETTNER I \ ì-|l .;-# I @ U I t rf a .f I 7 / -f I I l' a I J:.
American University Law Review, 1994
432 434 438 440 441 447 448 453 454 455 456 459 460 463 464 ALl, PRINCIPLES OF CORPORATE GOVERNANCE: ANALYSIS AND RECOMMENDATIONS § 1.34 (Proposed Final Draft, Mar. 31, 1992) [hereinafter ALl, CORPORATE GOVERNANCE] (discussing "significant relationship" between outside directors and corporations). 10. See HENN & ALEXANDER, supra note 8, § 204 (stating that most boards are two-thirds outsiders and one-third insiders). 11. HENN & ALEXANDER, supra note 8, § 219. 20. ADOLPH BERLE & GARDNER C. MEANS, THE MODERN CORPORATION AND PRIVATE PROPERTY (rev. ed. 1968). The book was the product of a collaboration that started in 1928, when Adolf Berle,Jr., was appointed research director of a project funded by the Social Science Research Council of America to investigate the impact of corporations on American society. Gardner C. Means was hired to conduct a careful statistical analysis of the growth of large corporations.
Corporate governance:[forthcoming in the new Palgrave dictionary of economics and the law]
While some of the questions have been around since Berle and Means (1932), the term \corporate governance" did not exist in the English language until twenty y ears ago. In the last two decades, however, corporate governance issues have become important not only in the academic literature, but also in public policy debates. During this period, corporate governance h a s b e e n i d e n ti ed with takeovers, nancial restructuring, and institutional investors' activism. But what exactly is corporate governance? Why is there a corporate governance \problem"? Why d o e s A d a m S m i t h ' s i n visible hand not automatically provide a solution? What role do takeovers, nancial restructuring, and institutional investors play in a corporate governance system? In this essay I will try to provide a systematic answer to these questions, making explicit the essential link between corporate governance and the theory of the rm. My goal is to provide a common framework that helps analyze the results obtained in these two elds and My views on this topic have been greatly in uenced by m y j o i n t w ork with Raghu Rajan, Walter Novaes, and Lucian Bebchuk. I also bene tted from conversations with (comments of
Corporate governance and regulation: Can there be too much of a good thing?
Journal of Financial Intermediation, 2010
Valentina Bruno holds a Ph.D. in Finance from the London School of Economics (2006), where she specialized in applied economics and finance, with a focus on assessing the effectiveness of alternative corporate governance regimes. Since 2006 she is at the World Bank, where she worked on a corporate governance project in the Financial and Private Sector Vice-Presidency. She is now with the International Finance Team of the Development Prospects Group, where she is actively involved in the Global Development Finance Report. Her main research interests are corporate finance and governance. Stijn Claessens is since 2004 Senior Adviser in the Financial and Private Sector Vice-Presidency of the World Bank. He is also a Professor of International Finance Policy at the University of Amsterdam where he taught for three years (2001-2004). Mr. Claessens, a Dutch national, holds a Ph.D. in business economics from the Wharton School of the University of Pennsylvania (1986) and M.A. from Erasmus University, Rotterdam (1984). He started his career teaching at New York University business school (1987) and then worked earlier for fourteen years at the World Bank in various positions (1987-2001). His policy and research interests are firm finance and access to financial services; corporate governance; internationalization of financial services; and risk management. Any opinions expressed here are those of the authors and not necessarily those of the FMG or the LSE.
European Journal of Business and Management, 2015
This paper is an attempt to identify the major causes for calls to improve corporate governance whether at the firm level or at the country level. The last three decades has witnessed exponential increase in corporate governance awareness, corporate governance regulations and a drive for improved corporate governance. Based on the review of the relevant literature five reasons has been identified as the major causes for calls to improve corporate governance. These causes are a) increase in firm size and complexity, b) separation of ownership and management, c) exponential growth of capital markets, d) increase in fraud cases and financial crises and, e) increased awareness of corporate governance impact on firm financial performance. Keywords: Corporate Governance, firm size, market growth, fraud, separation of ownership