Oliver Hart
- Published in print:
- 1995
- Published Online:
- November 2003
- ISBN:
- 9780198288817
- eISBN:
- 9780191596353
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198288816.001.0001
- Subject:
- Economics and Finance, Financial Economics
This book provides a framework for thinking about economic relationships and institutions such as firms. The basic argument is that in a world of incomplete contracts, institutional arrangements are ...
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This book provides a framework for thinking about economic relationships and institutions such as firms. The basic argument is that in a world of incomplete contracts, institutional arrangements are designed to allocate power among agents. The first part of the book is concerned with the boundaries of the firm. It is argued that traditional approaches such as the neoclassical, principal‐agent, and transaction costs theories cannot by themselves explain firm boundaries. The book describes a theory—the incomplete contracting or property rights approach—based on the idea that power and control matter when contracts are incomplete. If the terms of a transaction can always be renegotiated, the incentives of a party to undertake relationship‐specific investments will depend crucially on the ability to control the use of productive assets when renegotiation takes place. Asset ownership becomes an essential source of power. The theory suggests that firm boundaries are chosen to allocate power optimally among the various parties to a transaction. The foundations of incomplete contracting are also discussed.The remainder of the book applies incomplete contracting ideas to understand the financial structure of closely held and public companies. The analysis illustrates how debt acts as an automatic mechanism to constrain the behaviour of managers or owners of both kinds of companies. In closely held companies, debt can force an entrepreneur to pay out funds to investors rather than to himself. In a public company, ownership is dispersed among small shareholders causing a separation between ownership and control. It is argued that debt and equity choices, capital structure decisions, bankruptcy procedures, corporate governance, and takeovers, play a substantial role in limiting the ability of a (self‐interested) manager to make unprofitable but power‐enhancing decisions.Less
This book provides a framework for thinking about economic relationships and institutions such as firms. The basic argument is that in a world of incomplete contracts, institutional arrangements are designed to allocate power among agents. The first part of the book is concerned with the boundaries of the firm. It is argued that traditional approaches such as the neoclassical, principal‐agent, and transaction costs theories cannot by themselves explain firm boundaries. The book describes a theory—the incomplete contracting or property rights approach—based on the idea that power and control matter when contracts are incomplete. If the terms of a transaction can always be renegotiated, the incentives of a party to undertake relationship‐specific investments will depend crucially on the ability to control the use of productive assets when renegotiation takes place. Asset ownership becomes an essential source of power. The theory suggests that firm boundaries are chosen to allocate power optimally among the various parties to a transaction. The foundations of incomplete contracting are also discussed.
The remainder of the book applies incomplete contracting ideas to understand the financial structure of closely held and public companies. The analysis illustrates how debt acts as an automatic mechanism to constrain the behaviour of managers or owners of both kinds of companies. In closely held companies, debt can force an entrepreneur to pay out funds to investors rather than to himself. In a public company, ownership is dispersed among small shareholders causing a separation between ownership and control. It is argued that debt and equity choices, capital structure decisions, bankruptcy procedures, corporate governance, and takeovers, play a substantial role in limiting the ability of a (self‐interested) manager to make unprofitable but power‐enhancing decisions.
Jonathan Charkham and Anne Simpson
- Published in print:
- 1999
- Published Online:
- October 2011
- ISBN:
- 9780198292142
- eISBN:
- 9780191684876
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198292142.003.0004
- Subject:
- Business and Management, Corporate Governance and Accountability, Business History
This chapter discusses the role of regulation in corporate governance. The UK system has generally depended on a mixture of primary and secondary legislation with rules made by various non-statutory ...
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This chapter discusses the role of regulation in corporate governance. The UK system has generally depended on a mixture of primary and secondary legislation with rules made by various non-statutory bodies, some of which may, like the Stock Exchange, work under the umbrella of some legislation, and some, like the Cadbury Committee, with no umbrella at all. The creation of the Financial Services Authority is surely helpful. The work of the takeover panel is makes for interesting analysis. It can change its rules without reference to any other authority and has no means of enforcing its rules beyond what supporters are willing to do. Yet UK shareholders have good cause to be grateful to it, because it has succeeded in ensuring relatively equal treatment between them. It has established the rules of conduct about the purchase of shares in the market and governs the timetable and what must and must not be said.Less
This chapter discusses the role of regulation in corporate governance. The UK system has generally depended on a mixture of primary and secondary legislation with rules made by various non-statutory bodies, some of which may, like the Stock Exchange, work under the umbrella of some legislation, and some, like the Cadbury Committee, with no umbrella at all. The creation of the Financial Services Authority is surely helpful. The work of the takeover panel is makes for interesting analysis. It can change its rules without reference to any other authority and has no means of enforcing its rules beyond what supporters are willing to do. Yet UK shareholders have good cause to be grateful to it, because it has succeeded in ensuring relatively equal treatment between them. It has established the rules of conduct about the purchase of shares in the market and governs the timetable and what must and must not be said.
D. Hugh Whittaker and Simon Deakin (eds)
- Published in print:
- 2009
- Published Online:
- February 2010
- ISBN:
- 9780199563630
- eISBN:
- 9780191721359
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199563630.001.0001
- Subject:
- Business and Management, Corporate Governance and Accountability, HRM / IR
The chapters in this book address the state of Japanese corporate governance and managerial practice at a critical moment. They are based on detailed and intensive fieldwork in large Japanese ...
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The chapters in this book address the state of Japanese corporate governance and managerial practice at a critical moment. They are based on detailed and intensive fieldwork in large Japanese companies and interviews with investors, civil servants, and policy makers in the period following the adoption of significant corporate law reforms in the early 2000s up to the months just before the global financial crisis of 2008. At the start of the decade, the time seemed right for Japan to move to a shareholder value‐driven, “Anglo‐American” system of corporate governance. Instead, an adjustment and renewal of the postwar model of the large Japanese corporation has taken place. Japanese managers have adapted to and reshaped corporate governance norms, using them to reform internal decision‐making structures. The board's role is seen in terms of strategic planning rather than monitoring, and external directors are viewed as advisers, not as representatives of the shareholders. Companies have responded to the threat of hostile takeovers by putting poison pills in place and have rebuffed hedge fund activists' demands for higher dividends and share buybacks. Although shareholder influence is more extensive than it was, central aspects of the Japanese “community firm” ‐ in particular, managerial autonomy and a commitment to stable or “lifetime” employment for core of employees ‐ largely remain in place. The Japanese experience suggests that there are limits to the global convergence of company law systems, and that the widespread association of Anglo‐American practices with the “modernization” of corporate governance may have been misplaced.Less
The chapters in this book address the state of Japanese corporate governance and managerial practice at a critical moment. They are based on detailed and intensive fieldwork in large Japanese companies and interviews with investors, civil servants, and policy makers in the period following the adoption of significant corporate law reforms in the early 2000s up to the months just before the global financial crisis of 2008. At the start of the decade, the time seemed right for Japan to move to a shareholder value‐driven, “Anglo‐American” system of corporate governance. Instead, an adjustment and renewal of the postwar model of the large Japanese corporation has taken place. Japanese managers have adapted to and reshaped corporate governance norms, using them to reform internal decision‐making structures. The board's role is seen in terms of strategic planning rather than monitoring, and external directors are viewed as advisers, not as representatives of the shareholders. Companies have responded to the threat of hostile takeovers by putting poison pills in place and have rebuffed hedge fund activists' demands for higher dividends and share buybacks. Although shareholder influence is more extensive than it was, central aspects of the Japanese “community firm” ‐ in particular, managerial autonomy and a commitment to stable or “lifetime” employment for core of employees ‐ largely remain in place. The Japanese experience suggests that there are limits to the global convergence of company law systems, and that the widespread association of Anglo‐American practices with the “modernization” of corporate governance may have been misplaced.
Simon Deakin and D. Hugh Whittaker
- Published in print:
- 2009
- Published Online:
- February 2010
- ISBN:
- 9780199563630
- eISBN:
- 9780191721359
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199563630.003.0001
- Subject:
- Business and Management, Corporate Governance and Accountability, HRM / IR
This introductory chapter sets out the main themes of the book and provides an overview of the chapters that follow. The chapter explains how the traditional or postwar model of Japanese corporate ...
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This introductory chapter sets out the main themes of the book and provides an overview of the chapters that follow. The chapter explains how the traditional or postwar model of Japanese corporate governance came under pressure in the “lost decade” of the 1990s and how a debate concerning corporate governance was launched in the early 2000s which led to a number of reforms, including legal encouragement for the appointment of independent directors and changes to takeover law in the aftermath of the Livedoor case in 2005. The chapter suggests that Japan's recent experience should not be seen either in terms of a delayed transition to the “global standard” on corporate governance or of simple resistance to the Anglo-American model. Instead there has been a managerial adaptation to, and reshaping of, the corporate governance reforms, which, paradoxically, has served to strengthen the core features of the Japanese “community firm.”Less
This introductory chapter sets out the main themes of the book and provides an overview of the chapters that follow. The chapter explains how the traditional or postwar model of Japanese corporate governance came under pressure in the “lost decade” of the 1990s and how a debate concerning corporate governance was launched in the early 2000s which led to a number of reforms, including legal encouragement for the appointment of independent directors and changes to takeover law in the aftermath of the Livedoor case in 2005. The chapter suggests that Japan's recent experience should not be seen either in terms of a delayed transition to the “global standard” on corporate governance or of simple resistance to the Anglo-American model. Instead there has been a managerial adaptation to, and reshaping of, the corporate governance reforms, which, paradoxically, has served to strengthen the core features of the Japanese “community firm.”
Masaru Hayakawa and D. Hugh Whittaker
- Published in print:
- 2009
- Published Online:
- February 2010
- ISBN:
- 9780199563630
- eISBN:
- 9780191721359
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199563630.003.0003
- Subject:
- Business and Management, Corporate Governance and Accountability, HRM / IR
Livedoor's audacious takeover bid for Nippon Broadcasting System Inc. (NBS) in 2005 precipitated a flurry of judicial, legislative, administrative, and management actions, which have strongly ...
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Livedoor's audacious takeover bid for Nippon Broadcasting System Inc. (NBS) in 2005 precipitated a flurry of judicial, legislative, administrative, and management actions, which have strongly influenced thinking and practice related to corporate control in Japan. This chapter considers a number of statutory changes in the area of company law and securities regulations governing takeovers and analyses a series of judicial rulings, specifically involving Livedoor‐NBS and Steel Partners‐Bull‐Dog Sauce, and the contested use of poison pills and similar defense measures in these cases. It further looks at the recommendations and influence of the Corporate Value Study Group, before considering management responses. The chapter highlights a shift (as well as continuity) in perceptions about management control and legitimate defenses against takeovers, and predicts continued evolution, along a “Japanese” trajectory.Less
Livedoor's audacious takeover bid for Nippon Broadcasting System Inc. (NBS) in 2005 precipitated a flurry of judicial, legislative, administrative, and management actions, which have strongly influenced thinking and practice related to corporate control in Japan. This chapter considers a number of statutory changes in the area of company law and securities regulations governing takeovers and analyses a series of judicial rulings, specifically involving Livedoor‐NBS and Steel Partners‐Bull‐Dog Sauce, and the contested use of poison pills and similar defense measures in these cases. It further looks at the recommendations and influence of the Corporate Value Study Group, before considering management responses. The chapter highlights a shift (as well as continuity) in perceptions about management control and legitimate defenses against takeovers, and predicts continued evolution, along a “Japanese” trajectory.
Ronald Dore
- Published in print:
- 2009
- Published Online:
- February 2010
- ISBN:
- 9780199563630
- eISBN:
- 9780191721359
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199563630.003.0005
- Subject:
- Business and Management, Corporate Governance and Accountability, HRM / IR
In this chapter, Ronald Dore contrasts the rhetoric about the Japanese corporation's duties to multiple stakeholders, and the absence of proposals to modify the extent to which the law makes ...
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In this chapter, Ronald Dore contrasts the rhetoric about the Japanese corporation's duties to multiple stakeholders, and the absence of proposals to modify the extent to which the law makes shareholders the sole sovereign controller of the fate of companies. Under the “new orthodoxy” it has become difficult to publicly defend practices such as reciprocal shareholding, which shielded companies from hostile takeovers in the past, and strong constraints are applied to the use of new defensive measures. He cites the evolution of the Corporate Value Study Group, and its position on the primacy of shareholder interests, and argues that a strong lever for change has been wish to avoid charges of being heisateki (clannishly exclusive) from the foreign investment community and its Japanese allies. He concludes that, despite some management mutterings, Japan's conversion to shareholder capitalism may be unstoppable.Less
In this chapter, Ronald Dore contrasts the rhetoric about the Japanese corporation's duties to multiple stakeholders, and the absence of proposals to modify the extent to which the law makes shareholders the sole sovereign controller of the fate of companies. Under the “new orthodoxy” it has become difficult to publicly defend practices such as reciprocal shareholding, which shielded companies from hostile takeovers in the past, and strong constraints are applied to the use of new defensive measures. He cites the evolution of the Corporate Value Study Group, and its position on the primacy of shareholder interests, and argues that a strong lever for change has been wish to avoid charges of being heisateki (clannishly exclusive) from the foreign investment community and its Japanese allies. He concludes that, despite some management mutterings, Japan's conversion to shareholder capitalism may be unstoppable.
Nils Ringe
- Published in print:
- 2009
- Published Online:
- February 2010
- ISBN:
- 9780199572557
- eISBN:
- 9780191722431
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199572557.003.0005
- Subject:
- Political Science, Comparative Politics, European Union
Chapter 5 examines the role of focal points as mechanisms of information provision by analyzing a series of legislative proposals as case studies. It draws on interviews with EU officials and the ...
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Chapter 5 examines the role of focal points as mechanisms of information provision by analyzing a series of legislative proposals as case studies. It draws on interviews with EU officials and the statistical analysis of individual final votes on the EP floor. This chapter illustrates how focal points shape EP policy-making processes and outcomes. While Chapter 3 demonstrates that the policy positions of expert legislators determine the positions of their nonexpert colleagues on the EP floor, Chapter 5 shows how this process takes place for invested nonexpert legislators. The legislative proposals analyzed concern EU takeover legislation, the statute and financing of EU-level political parties, proposals on fuel quality and motor vehicle emissions, liability for environmental damage, the liberalization of port services in the EU, and EU citizenship and the free movement of people.Less
Chapter 5 examines the role of focal points as mechanisms of information provision by analyzing a series of legislative proposals as case studies. It draws on interviews with EU officials and the statistical analysis of individual final votes on the EP floor. This chapter illustrates how focal points shape EP policy-making processes and outcomes. While Chapter 3 demonstrates that the policy positions of expert legislators determine the positions of their nonexpert colleagues on the EP floor, Chapter 5 shows how this process takes place for invested nonexpert legislators. The legislative proposals analyzed concern EU takeover legislation, the statute and financing of EU-level political parties, proposals on fuel quality and motor vehicle emissions, liability for environmental damage, the liberalization of port services in the EU, and EU citizenship and the free movement of people.
Frank A. Schmid and Mark Wahrenburg
- Published in print:
- 2004
- Published Online:
- January 2005
- ISBN:
- 9780199253166
- eISBN:
- 9780191601651
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199253161.003.0009
- Subject:
- Economics and Finance, Financial Economics
Reviews the social setting and the regulatory framework for mergers and acquisitions in Germany. Past and existing takeover regulation is discussed against the backdrop of the German concept of ...
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Reviews the social setting and the regulatory framework for mergers and acquisitions in Germany. Past and existing takeover regulation is discussed against the backdrop of the German concept of Soziale Marktwirtschaft and recent financial modernisation in Germany. Case studies highlight important idiosyncratic regulatory and social aspects of transfers of cash flow rights on complex assets in Germany. Provides an extensive survey of past and existing takeover barriers, including the German system of codetermination.Less
Reviews the social setting and the regulatory framework for mergers and acquisitions in Germany. Past and existing takeover regulation is discussed against the backdrop of the German concept of Soziale Marktwirtschaft and recent financial modernisation in Germany. Case studies highlight important idiosyncratic regulatory and social aspects of transfers of cash flow rights on complex assets in Germany. Provides an extensive survey of past and existing takeover barriers, including the German system of codetermination.
Brendan McSweeney
- Published in print:
- 2012
- Published Online:
- September 2012
- ISBN:
- 9780199601462
- eISBN:
- 9780191743320
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199601462.003.0011
- Subject:
- Business and Management, Finance, Accounting, and Banking, Strategy
This chapter considers the main tactics employed during attempted takeovers (both negotiated and hostile) to enable or frustrate completion of a takeover. As takeover tactics do not have inherent ...
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This chapter considers the main tactics employed during attempted takeovers (both negotiated and hostile) to enable or frustrate completion of a takeover. As takeover tactics do not have inherent power—both their choice and effects are influenced by larger dynamics—the tactics are discussed in relation to a number of key contexts, including varieties of corporate governance and takeover strategies which shape, albeit they do not determine, their choice and efficacy.Less
This chapter considers the main tactics employed during attempted takeovers (both negotiated and hostile) to enable or frustrate completion of a takeover. As takeover tactics do not have inherent power—both their choice and effects are influenced by larger dynamics—the tactics are discussed in relation to a number of key contexts, including varieties of corporate governance and takeover strategies which shape, albeit they do not determine, their choice and efficacy.
Thomas L. Brodie
- Published in print:
- 2001
- Published Online:
- November 2003
- ISBN:
- 9780195138368
- eISBN:
- 9780199834037
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195138368.003.0040
- Subject:
- Religion, Biblical Studies
Both episodes seem grim: great famine (Genesis 47:12–28), and Jacob's impending death (47:29–ch. 48). Yet, both conclude with suggestions of vitality. Joseph's takeover of the famine‐struck land, ...
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Both episodes seem grim: great famine (Genesis 47:12–28), and Jacob's impending death (47:29–ch. 48). Yet, both conclude with suggestions of vitality. Joseph's takeover of the famine‐struck land, though it seems harsh, leads to a renewal. And, Jacob's deathbed is dominated not by doom but by blessing. (Linking Joseph's takeover of the land to Egyptian history does not change its narrative significance). The combination of upheaval in nature (world famine) with the upheaval of impending death has analogs in the lives of David and Jesus.Less
Both episodes seem grim: great famine (Genesis 47:12–28), and Jacob's impending death (47:29–ch. 48). Yet, both conclude with suggestions of vitality. Joseph's takeover of the famine‐struck land, though it seems harsh, leads to a renewal. And, Jacob's deathbed is dominated not by doom but by blessing. (Linking Joseph's takeover of the land to Egyptian history does not change its narrative significance). The combination of upheaval in nature (world famine) with the upheaval of impending death has analogs in the lives of David and Jesus.
Gregor Thum
- Published in print:
- 2011
- Published Online:
- October 2017
- ISBN:
- 9780691140247
- eISBN:
- 9781400839964
- Item type:
- chapter
- Publisher:
- Princeton University Press
- DOI:
- 10.23943/princeton/9780691140247.003.0003
- Subject:
- History, European Modern History
This chapter talks about the impending Polish takeover of the German territories. On August 2, 1945, the Allies decided to remove from the German Reich all territories east of the Oder and Lusatian ...
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This chapter talks about the impending Polish takeover of the German territories. On August 2, 1945, the Allies decided to remove from the German Reich all territories east of the Oder and Lusatian Neisse rivers and place them under Polish administration, with the exception of northern East Prussia, which was to be ceded to the Soviet Union. By this point in time a Polish mayor was already in office in Breslau and the population exchange was in full swing. However, before the Allies had reached an agreement about the precise location of the new German–Polish border, and while experts in the London Foreign Office and the Washington State Department were still reviewing the economic and logistical consequences of the various border proposals, the Soviet government and the Soviet-installed Polish regime had resolved the border issue on their own.Less
This chapter talks about the impending Polish takeover of the German territories. On August 2, 1945, the Allies decided to remove from the German Reich all territories east of the Oder and Lusatian Neisse rivers and place them under Polish administration, with the exception of northern East Prussia, which was to be ceded to the Soviet Union. By this point in time a Polish mayor was already in office in Breslau and the population exchange was in full swing. However, before the Allies had reached an agreement about the precise location of the new German–Polish border, and while experts in the London Foreign Office and the Washington State Department were still reviewing the economic and logistical consequences of the various border proposals, the Soviet government and the Soviet-installed Polish regime had resolved the border issue on their own.
Tessa Rajak
- Published in print:
- 2009
- Published Online:
- September 2009
- ISBN:
- 9780199558674
- eISBN:
- 9780191720895
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199558674.001.0001
- Subject:
- Classical Studies, Literary Studies: Classical, Early, and Medieval
The first translation of the Hebrew Bible into Greek was a major translation in Western culture. This literary and social study is about the ancient creators and receivers of the translations and ...
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The first translation of the Hebrew Bible into Greek was a major translation in Western culture. This literary and social study is about the ancient creators and receivers of the translations and about their impact. The book shows how the Greek Bible served the Jewish diaspora for over half a millennium, providing the foundations of life for a highly text-centred ethnic and religious minority as they fell under the pressures of the powerful imperial cultures of Greece and Rome, and of a dominant, ‘colonial’ language, Greek. Those large communities of the eastern Mediterranean, with their converts and sympathizers, determined the pattern of Jewish existence outside Palestine for centuries. Far from being isolated and inward-looking, they were, we now know, active members of their city environments. Yet they were not wholly assimilated. The book asks exactly how the translations operated as tools for the preservation of group identity and how, even in their language, they offered a quiet cultural resistance. The Greek Bible translations ended up as the Christian Septuagint, taken over along with the entire heritage of the remarkable hybrid culture of Hellenistic Judaism, during the process of the Church's long drawn-out parting from the Synagogue. That transference allowed the recipients to sideline Christianity's original Jewishness and history to be re-written. In this book, history is recovered and a great cultural artifact is restored to its proper place.Less
The first translation of the Hebrew Bible into Greek was a major translation in Western culture. This literary and social study is about the ancient creators and receivers of the translations and about their impact. The book shows how the Greek Bible served the Jewish diaspora for over half a millennium, providing the foundations of life for a highly text-centred ethnic and religious minority as they fell under the pressures of the powerful imperial cultures of Greece and Rome, and of a dominant, ‘colonial’ language, Greek. Those large communities of the eastern Mediterranean, with their converts and sympathizers, determined the pattern of Jewish existence outside Palestine for centuries. Far from being isolated and inward-looking, they were, we now know, active members of their city environments. Yet they were not wholly assimilated. The book asks exactly how the translations operated as tools for the preservation of group identity and how, even in their language, they offered a quiet cultural resistance. The Greek Bible translations ended up as the Christian Septuagint, taken over along with the entire heritage of the remarkable hybrid culture of Hellenistic Judaism, during the process of the Church's long drawn-out parting from the Synagogue. That transference allowed the recipients to sideline Christianity's original Jewishness and history to be re-written. In this book, history is recovered and a great cultural artifact is restored to its proper place.
Fabrizio Barca and Marco Becht (eds)
- Published in print:
- 2002
- Published Online:
- November 2003
- ISBN:
- 9780199257539
- eISBN:
- 9780191595905
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199257531.001.0001
- Subject:
- Economics and Finance, Financial Economics
Written by an international team of authors, this book provides the first systematic account of the control of corporate Europe based on voting block data disclosed in accordance with the European ...
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Written by an international team of authors, this book provides the first systematic account of the control of corporate Europe based on voting block data disclosed in accordance with the European Union's Large Holdings Directive (88/627/EEC). The study provides detailed information on the voting control of companies listed on the official markets in Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, the UK, and as a benchmark comparison, the US. The authors record a high concentration of control of corporations in many European countries, with a single blockholder frequently controlling more than 50% of the corporate votes. In contrast, a majority of UK‐listed companies have no blockholder owning more than 6% of shares. These chapters devoted to individual countries illustrate how blockholders can use legal devices to leverage their voting power over their cash‐flow rights or how incumbents prevent outsiders from gaining voting control.Less
Written by an international team of authors, this book provides the first systematic account of the control of corporate Europe based on voting block data disclosed in accordance with the European Union's Large Holdings Directive (88/627/EEC). The study provides detailed information on the voting control of companies listed on the official markets in Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, the UK, and as a benchmark comparison, the US. The authors record a high concentration of control of corporations in many European countries, with a single blockholder frequently controlling more than 50% of the corporate votes. In contrast, a majority of UK‐listed companies have no blockholder owning more than 6% of shares. These chapters devoted to individual countries illustrate how blockholders can use legal devices to leverage their voting power over their cash‐flow rights or how incumbents prevent outsiders from gaining voting control.
Antoin E. Murphy
- Published in print:
- 1997
- Published Online:
- November 2003
- ISBN:
- 9780198286493
- eISBN:
- 9780191596674
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/019828649X.003.0014
- Subject:
- Economics and Finance, History of Economic Thought
In 1719, Law was successful in taking over all of the trading companies, the rights to the Mint, and the tax farms. He had created a giant holding company. In August 1719, he proposed taking over the ...
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In 1719, Law was successful in taking over all of the trading companies, the rights to the Mint, and the tax farms. He had created a giant holding company. In August 1719, he proposed taking over the totality of the French national debt. The Company's share price rose from 500 in the Spring to over 10,000 in the Autumn of 1719. Massive financial speculation took place on Rue Quincampoix.Less
In 1719, Law was successful in taking over all of the trading companies, the rights to the Mint, and the tax farms. He had created a giant holding company. In August 1719, he proposed taking over the totality of the French national debt. The Company's share price rose from 500 in the Spring to over 10,000 in the Autumn of 1719. Massive financial speculation took place on Rue Quincampoix.
Hendrik S. Houthakker and Peter J. Williamson
- Published in print:
- 1996
- Published Online:
- November 2003
- ISBN:
- 9780195044072
- eISBN:
- 9780199832958
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/019504407X.003.0003
- Subject:
- Economics and Finance, Financial Economics
The supply of securities is examined both in terms of the contractual characteristics and importance of each main type and the way in which the actual performance and supply of each over time is ...
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The supply of securities is examined both in terms of the contractual characteristics and importance of each main type and the way in which the actual performance and supply of each over time is influenced by the behavior of issuers. The analysis presented is with respect to the USA. The securities explored include government securities – municipal bonds and bonds of foreign governments and international organizations; corporate securities – equities and senior debt, takeovers, bonds, junk bonds, convertible securities; mutual fund shares; mortgages and mortgage‐backed securities. The chapter also includes discussion of the implications for the supply of securities of corporate financial policy, partnership units and business taxation, and claims on financial institutions.Less
The supply of securities is examined both in terms of the contractual characteristics and importance of each main type and the way in which the actual performance and supply of each over time is influenced by the behavior of issuers. The analysis presented is with respect to the USA. The securities explored include government securities – municipal bonds and bonds of foreign governments and international organizations; corporate securities – equities and senior debt, takeovers, bonds, junk bonds, convertible securities; mutual fund shares; mortgages and mortgage‐backed securities. The chapter also includes discussion of the implications for the supply of securities of corporate financial policy, partnership units and business taxation, and claims on financial institutions.
Oliver Rieckers and Gerald Spindler
- Published in print:
- 2004
- Published Online:
- January 2005
- ISBN:
- 9780199253166
- eISBN:
- 9780191601651
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199253161.003.0011
- Subject:
- Economics and Finance, Financial Economics
Although there are plenty of signs that the German model of corporate governance is indeed forced into a transition to a more capital market-oriented one, the remnants of the old modus operandi ...
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Although there are plenty of signs that the German model of corporate governance is indeed forced into a transition to a more capital market-oriented one, the remnants of the old modus operandi persist. In portraying the traditional legal foundations of German corporate governance, the present chapter first explores how such archetypal internal structures as the dual board system, mandatory labour codetermination and the specific legal regime for groups of companies are embedded in the fundamental structure of German corporate law.It then outlines some of the issues that define the ongoing transition process. The basic general thrust of this part is that the traditional corporate governance system, which has long been dominated by a focus on the legal rules determining the inner structures of the corporation, is more and more integrating new elements of an emerging body of capital market laws leaving German stock corporations under the governance of a non-uniform set of rules. Recent developments such as the German takeover law and the German Corporate Governance Code will further strengthen capital market orientation, but the final outcome of this process of modernisation cannot be assessed clearly yet.Less
Although there are plenty of signs that the German model of corporate governance is indeed forced into a transition to a more capital market-oriented one, the remnants of the old modus operandi persist. In portraying the traditional legal foundations of German corporate governance, the present chapter first explores how such archetypal internal structures as the dual board system, mandatory labour codetermination and the specific legal regime for groups of companies are embedded in the fundamental structure of German corporate law.
It then outlines some of the issues that define the ongoing transition process. The basic general thrust of this part is that the traditional corporate governance system, which has long been dominated by a focus on the legal rules determining the inner structures of the corporation, is more and more integrating new elements of an emerging body of capital market laws leaving German stock corporations under the governance of a non-uniform set of rules. Recent developments such as the German takeover law and the German Corporate Governance Code will further strengthen capital market orientation, but the final outcome of this process of modernisation cannot be assessed clearly yet.
Eric Nowak
- Published in print:
- 2004
- Published Online:
- January 2005
- ISBN:
- 9780199253166
- eISBN:
- 9780191601651
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199253161.003.0013
- Subject:
- Economics and Finance, Financial Economics
La Porta et al . have shown that differences among countries in legal codes and enforcement of investor protection account for much of the disparity in the size and development of their financial ...
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La Porta et al . have shown that differences among countries in legal codes and enforcement of investor protection account for much of the disparity in the size and development of their financial markets. According to their empirical measure of shareholder protection, Germany scores only one out of five possible points on an aggregated index scale.This chapter argues that this assessment is no longer correct, because Germany has reformed its capital market regulation in ways that now afford much greater shareholder protection. In four sections, the chapter examines these developments and their effect on changes in corporate governance and investor protection to date.Less
La Porta et al . have shown that differences among countries in legal codes and enforcement of investor protection account for much of the disparity in the size and development of their financial markets. According to their empirical measure of shareholder protection, Germany scores only one out of five possible points on an aggregated index scale.
This chapter argues that this assessment is no longer correct, because Germany has reformed its capital market regulation in ways that now afford much greater shareholder protection. In four sections, the chapter examines these developments and their effect on changes in corporate governance and investor protection to date.
Oliver Hart
- Published in print:
- 1995
- Published Online:
- November 2003
- ISBN:
- 9780198288817
- eISBN:
- 9780191596353
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198288816.003.0009
- Subject:
- Economics and Finance, Financial Economics
In a public company, ownership is dispersed among small shareholders, causing a separation between ownership and control. This chapter discusses the role of takeovers and voting rights in limiting ...
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In a public company, ownership is dispersed among small shareholders, causing a separation between ownership and control. This chapter discusses the role of takeovers and voting rights in limiting the ability of a management team to pursue its own goals rather than maximizing the company's public value. Using a general model of the effects of security‐voting structure on control transactions, it is shown that, under a reasonable set of assumptions, the optimal structure is a single class of shares with votes attached (‘one share‐one vote’). The author also discusses situations in which departures from ‘one share‐one vote’ may be optimal and relates the results to the empirical evidence.Less
In a public company, ownership is dispersed among small shareholders, causing a separation between ownership and control. This chapter discusses the role of takeovers and voting rights in limiting the ability of a management team to pursue its own goals rather than maximizing the company's public value. Using a general model of the effects of security‐voting structure on control transactions, it is shown that, under a reasonable set of assumptions, the optimal structure is a single class of shares with votes attached (‘one share‐one vote’). The author also discusses situations in which departures from ‘one share‐one vote’ may be optimal and relates the results to the empirical evidence.
Hersh Shefrin
- Published in print:
- 2002
- Published Online:
- November 2003
- ISBN:
- 9780195161212
- eISBN:
- 9780199832996
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0195161211.003.0016
- Subject:
- Economics and Finance, Financial Economics
There is general evidence that corporate executives exhibit hubris, that they are impressed with their own abilities. Since July 1996, the Financial Executives Institute and Duke University have been ...
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There is general evidence that corporate executives exhibit hubris, that they are impressed with their own abilities. Since July 1996, the Financial Executives Institute and Duke University have been jointly surveying corporate executives on a quarterly basis. During the first two years of the survey, executives of companies whose stocks are publicly traded have consistently indicated that their companies were undervalued. Corporate decisions offer ample examples of heuristic‐driven bias and frame dependence. In this chapter, I discuss several: excessive optimism, the illusion of control, gambler's fallacy, and loss aversion—the tendency to throw good money after bad. However, the primary bias involved in corporate takeovers is hubris, because it leads to the phenomenon of winner's curse, where the acquiring firm overpays for the target. The chapter describes the takeover of computer maker NCR by American Telephone and Telegraph (AT&T).Less
There is general evidence that corporate executives exhibit hubris, that they are impressed with their own abilities. Since July 1996, the Financial Executives Institute and Duke University have been jointly surveying corporate executives on a quarterly basis. During the first two years of the survey, executives of companies whose stocks are publicly traded have consistently indicated that their companies were undervalued. Corporate decisions offer ample examples of heuristic‐driven bias and frame dependence. In this chapter, I discuss several: excessive optimism, the illusion of control, gambler's fallacy, and loss aversion—the tendency to throw good money after bad. However, the primary bias involved in corporate takeovers is hubris, because it leads to the phenomenon of winner's curse, where the acquiring firm overpays for the target. The chapter describes the takeover of computer maker NCR by American Telephone and Telegraph (AT&T).
Marco Becht and Ekkehart Böhmer
- Published in print:
- 2002
- Published Online:
- November 2003
- ISBN:
- 9780199257539
- eISBN:
- 9780191595905
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199257531.003.0005
- Subject:
- Economics and Finance, Financial Economics
This paper analyses the voting control structure of industrial firms listed on the official market in Germany. Voting control is highly concentrated and few companies are widely held. Widely held ...
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This paper analyses the voting control structure of industrial firms listed on the official market in Germany. Voting control is highly concentrated and few companies are widely held. Widely held companies typically have takeover defences in place, but these are increasingly eroded by the control and transparency law.Less
This paper analyses the voting control structure of industrial firms listed on the official market in Germany. Voting control is highly concentrated and few companies are widely held. Widely held companies typically have takeover defences in place, but these are increasingly eroded by the control and transparency law.
