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Journal articles on the topic 'Shareholders'
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1
Miyake, Masatoshi, Mei Yu, and Hiroshi Inoue. "Mitigating risk incentives by issuing convertible bonds: A refinement to the Black–Scholes evaluation model." Journal of Financial Engineering 01, no. 03 (September 2014): 1450024. http://dx.doi.org/10.1142/s234576861450024x.
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This study employs option pricing theory to analyze the risk incentive conflict between shareholders and creditors. It evaluates the volatility of investment projects funded by borrowed money and compares their gains for the shareholder and creditor. Our analysis is based on the recognition that shareholders' and creditors' objectives may differ. We identify the shareholder's risk incentive as a source of agency cost originating with the shareholder and find that issuing a convertible bond avoids agency cost without diluting existing shareholders' ownership. Numerical examples are shown to examine it.
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Gounder, Chitra Gunshekhar, and M. Venkateshwarlu. "Shareholder Value Creation: An Empirical Analysis of Indian Banking Sector." Accounting and Finance Research 6, no. 1 (February 14, 2017): 148. http://dx.doi.org/10.5430/afr.v6n1p148.
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This study investigates the importance of economic value added for the shareholders’ value maximization. Economic value added (EVA) is a value based performance measurement tool that helps to settle down the management decision regarding creation of shareholders value. Very few literatures are found regarding creation of shareholder values in banks. Sample of 40 Indian commercial listed Banks and panel data are used for the period of 2001 to 2015, the empirical findings for Public limited banks and overall Indian banks revealed that there is a positive and significant relationship between shareholder’s value maximization and EVA but in case of Private limited banks, DPS was found to have significant relationship with shareholder value. The Higher the value of EVA, higher shareholders value .The finding shows significant support for EVA and DPS, but it was found that EVA is not efficiently used for Analysis and decision making regarding creation of value. Thus it is suggested to focus on criteria of EVA for analyzing shareholder’s value of banks.
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Smitiukh, Andrii. "The grounds of the shareholder’s withdrawal from the limited liability companies and legal entities of the similar corporate forms: the comparative legal aspect." Law Review of Kyiv University of Law, no. 1 (April 15, 2020): 188–92. http://dx.doi.org/10.36695/2219-5521.1.2020.38.
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The article presents the result of comparative legal studies of the grounds of the shareholder’s withdrawal from the limited liability companies as well as legal entities of the similar corporate forms provided by the laws of some countries (namely Armenia, Belarus, Belgium, Czech Republic, the Netherlands, Poland, Russian Federation, Switzerland, Turkey, Ukraine and the United Kingdom). It is concluded that in most legal systems the ground of the withdrawal is a set of facts composed of the main element – the declaration of will of the shareholder to terminate the corporate relationship of participation and an additional element of a subjective or objective nature. The aforesaid additional element of the objective nature in turn may be expressed by law in evaluation category or not. The additional elements of the set of facts composimng the ground of the withdrawal has been classified in the article. So, an additional element of the set of facts of the subjective nature is a declaration of will of the rest of shareholders to allow the shareholder’s withdrawal. An additional element of the set of facts of the subjective nature may be provided by law in a «simple» way as a circumstances established by the company’s articles of association or as an important decision of the general shareholders meeting objected by the minor shareholder or as a cause expressed by law in evaluation categories as a material breach of rights and interests of the shareholders by the company or other shareholders («just cause», «good cause», «justes motif», «the company's affairs are being or have been conducted in a manner that is unfairly prejudicial to the interests of shareholders» etc.). The correlation between the nature of additional elements of the ground of the shareholder’s withdrawal and the mode of the withdrawal has been investigated. The court mode of the shareholder’s withdrawal is always provided if an additional element of the set of facts composing the ground of the withdrawal is expressed in evaluation categories as a material breach of rights and interests of the shareholder by the company or other shareholders. The different additional elements of the set of facts composing the ground of the shareholder’s withdrawal may be provided by the law of the same legal system for judicial and non-judicial modes of the withdrawal.
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Fegyveresi, Zsolt. "Shareholders' Right to Information − A Comparative Analysis of Hungarian and Romanian Company Law." Acta Universitatis Sapientiae Legal Studies 9, no. 1 (December 2, 2020): 39–62. http://dx.doi.org/10.47745/ausleg.2020.9.1.03.
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"This study examines one of the basic rights of shareholders, the right to information in Hungarian and Romanian company law. The right to information is a non-property, organizational right originating from the shareholder’s membership right, which is related to the convening of the general meeting of the company limited by shares and the voting right that can be exercised there. The right to information is the individual right of the shareholder and the individual obligation of the company. The right to information belongs to all shareholders, regardless of the extent of their fi nancial contribution. The exercise of the right to information is a fundamental principle and serves the protection of the shareholder, but, in addition to its protective nature, it stands at the basis of the preparation of the decisions of the company’s shareholders."
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Guo, Ruining, and Ziyang Li. "CSR Initiatives of Controlling Shareholder in Share Pledge Firms: Sustainable Orientation or Interim Plan?" E3S Web of Conferences 409 (2023): 04001. http://dx.doi.org/10.1051/e3sconf/202340904001.
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This paper investigates the effects of share pledge by controlling shareholder on corporate social responsibility and the mechanism through which stock pledge affects CSR. Using a sample of Chinese listed firms from 2008 to 2020, we find that firms with pledging controlling shareholders are more likely to invest in corporate social responsibility (CSR) than other firms. Their CSR also perform better even when all pledge funds are invested to shareholders themselves rather than to the company’s operation. We then provide evidence to show that the motivating effect of stock pledge by controlling shareholder on CSR is related to controlling shareholder’s incentives to improve corporate value to prevent loss of corporate control and reduce the risk of stock price crash. These results consistently suggest that controlling shareholders employ corporate social responsibility as an effective way to reduce the risk of controlling right transfer.
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Panigrahi, Shrikant Krupasindhu, Yuserrie Bin Zainuddin, and Noor Azlinna Binti Azizan. "Linkage of Management Decisions to Shareholder’s Value: EVA Concept." International Journal of Finance & Banking Studies (2147-4486) 3, no. 1 (January 19, 2016): 114. http://dx.doi.org/10.20525/.v3i1.173.
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<p>In this paper, the author investigated the influence of management decisions like capital structure, dividend policies, remunerations, credit policy decisions and investment decisions on shareholder wealth maximization. The main objective of this paper is to increase awareness and relationship between management and shareholders of the companies. To achieve the objective, portfolio theory, capital asset pricing model and modern financial theory providing evidence on the linkage between management decisions to shareholder’s value. Shareholders are only concerned about the value of shares of the company and the amount of return in the form of dividend paid. Thus in order to meet the demands of the shareholders of the company, managers needs to increase their abilities and skills to overcome the organizational goals. Thus the main goal of this paper is to discuss on the role of management decisions towards increasing shareholder’s wealth and meet organizational goals.</p>
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Panigrahi, Shrikant Krupasindhu, Yuserrie Bin Zainuddin, and Noor Azlinna Binti Azizan. "Linkage of Management Decisions to Shareholder’s Value." International Journal of Finance & Banking Studies (2147-4486) 3, no. 1 (July 21, 2014): 114–25. http://dx.doi.org/10.20525/ijfbs.v3i1.173.
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In this paper, the author investigated the influence of management decisions like capital structure, dividend policies, remunerations, credit policy decisions and investment decisions on shareholder wealth maximization. The main objective of this paper is to increase awareness and relationship between management and shareholders of the companies. To achieve the objective, portfolio theory, capital asset pricing model and modern financial theory providing evidence on the linkage between management decisions to shareholder’s value. Shareholders are only concerned about the value of shares of the company and the amount of return in the form of dividend paid. Thus in order to meet the demands of the shareholders of the company, managers needs to increase their abilities and skills to overcome the organizational goals. Thus the main goal of this paper is to discuss on the role of management decisions towards increasing shareholder’s wealth and meet organizational goals.
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Chuan, Lin, and Zhai Haomiao. "Major Shareholders’ Reduction and the Risk of Stock Price Crash." Journal of Asian Research 7, no. 3 (July 20, 2023): p11. http://dx.doi.org/10.22158/jar.v7n3p11.
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This paper takes China Shanghai and Shenzhen A-share listed companies from 2007 to 2021 as samples to empirically test the impact of major shareholder reduction on the risk of stock price crash. This paper finds that the reduction of major shareholders promotes the risk of stock price crash of listed companies, that is, compared with listed companies without major shareholders’ reduction, the risk of stock price crash of listed companies with major shareholders’ reduction is higher, and this conclusion still holds after controlling the conservative factors. Further examination shows that the major shareholder’s manipulation of information has an impact on the risk of stock price crash, and the impact of major shareholder’s reduction on the risk of stock price crash is more obvious in China state-owned enterprises, non-high-tech enterprises, enterprises in the bull market period and enterprises in areas with low market investors.
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Vutt, Andres, and Margit Vutt. "Shareholder Exit in Estonian Private Limited Companies: Proposals of the Company Law Revision Working Group." Juridica International 30 (October 13, 2021): 140–51. http://dx.doi.org/10.12697/ji.2021.30.16.
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Private limited companies are small, closed companies in which, as a rule, there are few shareholders. Regrettably, conflicts arise between shareholders that cannot be resolved in such a way that the persons in dispute remain shareholders, since protracted litigation reduces the value of the company and may lead to the closing of the business. For resolving such situations, several countries have made provisions in their laws for the possibility of shareholder exit. Current Estonian law does not provide for shareholder exit. The law regulates only a shareholder’s expulsion, but this remedy is not widely used in practice, since its scope is so limited. This mechanism cannot be used for solving the problems in most cases. There are some other possibilities for shareholder exit, but they are merely theoretical and have not been proved in case law. A review of Estonia’s company law commenced in 2016, and the working group presented its proposals for amending the relevant laws in 2019. One proposal made by the revision working group was to bring into the law provisions governing shareholder exit. Under the proposals made, shareholder exit would be possible only for a valid reason and as ultima ratio. The right to claim for exclusion of a shareholder is held by any shareholder(s) having at least 50% of the votes. If a shareholder is excluded from the company, the court has to determine the compensation to be paid to the departing shareholder, taking into account the rules on capital maintenance.
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Gratham, Ross. "The Unanimous Consent Rule in Company Law." Cambridge Law Journal 52, no. 2 (July 1993): 245–71. http://dx.doi.org/10.1017/s0008197300095155.
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In the history of the modern company the shareholder has held a privileged position, for although the company's separate identity is the fundamental tenet of company law the shareholder's place as proprietor has only recently been questioned. It is perhaps not surprising therefore that for nearly a century the unanimous assent of shareholders has held the status of an overriding authority, able to cure procedural defects, overcome statutory requirements and validate almost any act within the capacity of the company. In its most recent application in Brick and Pipe Industries Ltd. v. Occidental Life Nominees Pty. Ltd., where the consent of shareholders was held to bind the company to a guarantee, we have a striking example of the authority accorded to the wishes of shareholders.
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Li, Weian, and Jianbo Niu. "Private interest and social interest of shareholders: empirical evidence from China." Corporate Ownership and Control 5, no. 1 (2007): 254–61. http://dx.doi.org/10.22495/cocv5i1c2p1.
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We try to explore the relation among three factors: the private benefits that main shareholders can obtain from the firm, the social benefits derived from a certain ownership structure and the ownership concentration costs. Different corporations have different optimal governance mechanism. Noticing the substitute relation between the level of the management-and-shareholder-conflicts and the different governance mechanism, we take use of the data from China’ stock market and conduct an empirical analysis on the influence both of the different shareholder’s participating in governance and the ownership structure over corporate performance, and have reached two conclusions. First, in the companies with a higher level of conflicts between the management and the shareholders, the shareholder will be more active in participating in governance because the benefits earned here is much more than the company with a lower level of conflicts. Second, when the other governance mechanisms in one company perform poorly, the shareholder is less active in participating in governance because the extra benefits earned here cannot offset their costs. So only in these companies with poor governance mechanisms, the shareholders’ active monitoring can produce benefits. These conclusions can help our further research on the relationship among the shareholder supervision, ownership structure and corporate value, and we should also re-evaluate some traditional theoretical viewpoints
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Kahan, Marcel, and Edward Rock. "Corporate Governance Welfarism." Journal of Legal Analysis 15, no. 1 (August 23, 2023): 108–28. http://dx.doi.org/10.1093/jla/laad007.
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Abstract Corporate governance is on the verge of entering a new stage. After the managerialism that dominated the view of the corporation into the 1970s and the shareholderism that supplanted it, we are witnessing the emergence of a new paradigm: corporate governance welfarism. Welfarism rejects the faith that market forces will promote general welfare and lacks confidence in the government’s ability to set proper boundary constraints. By looking to corporations to internalize externalities directly, welfarism thus offers an alternative way to deal with social problems that the political system has failed to address. Welfarism comes in three strands—portfolio welfarism, shareholder welfarism, and direct social welfarism—two of which are consistent with shareholder primacy. The important distinction between welfarism and shareholderism, rather, is that welfarism, by embracing goals that are much broader than shareholder value as a means to promote overall welfare, reflects a departure from the classical liberal economic theory that underpins shareholderism. Welfarism, in turn, departs from managerialism in looking beyond the single firm, in relying on shareholder and stakeholder pressure rather than on managerial discretion to balance firm value maximization and broader objectives, and in embracing a wider set of potential stakeholders. Welfarism is on the rise ideologically. While it is unclear how much welfarism has already affected operations at individual firms, the underlying drivers of welfarism are likely to remain or grow. There are, therefore, good reasons to believe that the push towards welfarism will take hold, grow, and, over time, generate a welfarist turn in corporate governance. Welfarism, however, is subject to two inherent limitations. First, welfarism has its greatest traction for publicly traded companies with dispersed shareholders. By contrast, for companies with a single shareholder, a controlling shareholder, or a small group of shareholders, the welfarist prescriptions will have only a limited impact. Second, the very lack of consensus that impedes political solutions reemerges under and constrains welfarism by generating disagreements among shareholders, impugning its legitimacy, and imposing political barriers to its implementation.
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Howton, Shawn D., Shelly W. Howton, and Victoria B. McWilliams. "The Ethical Implications of Ignoring Shareholder Directives to Remove Antitakeover Provisions." Business Ethics Quarterly 18, no. 3 (July 2008): 321–46. http://dx.doi.org/10.5840/beq200818326.
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Managers have a unique fiduciary responsibility to shareholders of a firm that implies a set of ethical obligations. At a minimum, managers are required to protect shareholder’s interests when other stakeholders are unaffected by their decision. This ethical imperative has been established in the literature. In cases of conflicts of interest between managers and shareholders, the board of directors of the firm has an ethical obligation to shareholders. The structure of the board can affect its ability to fulfill this obligation. Two specific cases where managerial actions have been argued to be unethical are the adoption of classified boards and poison pills. In this study, we empirically analyze the role of board structure in protecting shareholder rights in the specific case of antitakeover provisions. We test this question on a sample of firms whose shareholders have voted to remove antitakeover provisions and find that independent, focused boards are more likely to accede to shareholder resolutions than are less independent boards. Board size is also important and related to other board structures. We draw implications of this finding for future research on the ethics of board governance.What’s really needed is a change in mindset—one that fosters not only a culture of compliance but also a company-wide environment that fosters ethical behavior and decision-making.—William H. Donaldson, SEC Chairman (2004)
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Xie, Yue, Tianhui Wang, Jinhua Zhang, and Na Wang. "Does controlling shareholders’ share pledge exacerbate excessive financialization of enterprises?—Evidence from performance pressure perspective." PLOS ONE 18, no. 7 (July 19, 2023): e0288705. http://dx.doi.org/10.1371/journal.pone.0288705.
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Based on the perspective of performance pressure, we explore the influence of controlling shareholders’ share pledge on excessive financialization behavior of enterprises and its internal mechanism. The results show that the share pledge of controlling shareholders is positively correlated with the excessive financialization behavior of enterprises. After the controlling shareholder’s share pledge, the actual performance of the enterprise is lower than expected, causing the short-sighted behavior of the management, which makes the management willing to conspire with the controlling shareholder to cause the excessive financialization of the enterprise. The results are especially evident among the uncertainty of economic policy is low, the industry competition is not fierce and the executives have overseas experience.
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Kuek, Thiam-Yong, I.-Chi Chen, Yuen-Onn Choong, Saw-Chin Khor, Mei-Peng Low, and Timothy Tzen-Vun Yap. "STUDY OF PAST DECADE (2010 - 2020) SELECTED LITERATURE ON MINORITY SHAREHOLDER AND SHAREHOLDER ACTIVISM IN MALAYSIA." Advanced International Journal of Business, Entrepreneurship and SMEs 3, no. 7 (March 1, 2021): 49–58. http://dx.doi.org/10.35631/aijbes.37005.
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Due to its vitality in preserving the stability, transparency, and sound management of businesses, corporate governance continues to play a dominant role in many Malaysian companies. This will give the country and foreign countries good opportunities to invest in Malaysia and provide an investment-friendly environment. It adds color to the existing soft stock market in Malaysia as a result of the economic instability, the political turmoil, and the pandemic effects of Covid-19. Two main elements of corporate governance in Malaysia, minority shareholders, and shareholder activities will be addressed in this article. Minority shareholders, in particular publicly-listed companies in Malaysia, are major players in companies. However, in other countries, the general opinion among minority shareholders is that executives, administrators, and main shareholders or control shareholders tend to take advantage of them for their own personal purposes. As a result, shareholder activism plays a key role in making shareholders aware of their rights and obligations in the ownership of the firm, in particular as minority shareholders, through this activism. However, Malaysia has not yet come to a firm conclusion on the effectiveness of shareholder interference. Five articles on minority shareholders and shareholder activism relevant to Malaysia, each from 2010 to 2020, were retrieved from Google Scholar and examined from Malaysia's corporate governance perspective to determine the extent of their growth.
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PAYNE, JENNIFER. "“CLEAN HANDS” IN DERIVATIVE ACTIONS." Cambridge Law Journal 61, no. 1 (March 7, 2002): 76–86. http://dx.doi.org/10.1017/s0008197302001538.
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THIS article challenges the commonly expressed view that shareholders wishing to bring a derivative action on behalf of the company must have “clean hands” ie that there must be nothing in the shareholders behaviourwhich renders it unjust to allow the derivative action to proceed. While minority shareholders’ misbehaviour might well have consequences for themselves, such as requiring the repayment of dividends known to have been paid unlawfully, those actions ought, in the normal course of events, to be irrelevant for the purpose of deciding whether to allow a derivative action to proceed. This article suggests some circumstances in which a minority shareholder’s situation or actions may affect the decision to allow a derivative action brought by that particular shareholder to proceed, but these do not spring from the clean hands doctrine, but rather from the particular factual circumstances of the case or from an entirely proper desire on the court’s part to use the derivative action only where it is necessary to achieve justice for the company
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Van der Elst, Christoph. "Shareholder activism in good and bad economic times." Corporate Ownership and Control 8, no. 2, Special issue (2011): 32–43. http://dx.doi.org/10.22495/cocv8i2sip3.
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Over the last few years the economy shifted from fast growth to a deep financial and economic crisis. Slowly companies are returning to growth rates in 2009-2010 after a sharp fall of profits in 2007-2009. This provides an excellent backdrop to assess trends in shareholder activism, how shareholders responded to the fall in profits and how they have exercised influence in these turbulent times. This paper focuses on the activism exerted by shareholders at annual general meetings of shareholders between 2007 and 2010 via their attendance and voting at AGMs in four European countries. The main research questions answered are the way large and minority shareholders expressed their voice at general meetings of shareholders and what drives this type of shareholder activism. The drivers of shareholder activism at general meetings are empirically tested. Four factors that can influence the willingness and probability of shareholder attendance and voting turnouts that are tested are shareholder structure, corporate performance, institutional framework and size of the companies. Overall shareholder activism measured as the attendance at general meetings between 2007 and 2010 did not significantly change. It is found that the ownership structure and institutional frameworks are important drivers of shareholder attendance. Corporate performance and size have no significant impact on attendance. We conclude that shareholder activism depends on the identity of large individual shareholders shedding doubts on the effectiveness of one size fits all (mandatory) corporate governance measures.
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Zulkafli, Abdul Hadi, and Ahmad Husni Hamzah. "Corporate contestability and corporate expropriation." Risk Governance and Control: Financial Markets and Institutions 6, no. 4 (2016): 403–9. http://dx.doi.org/10.22495/rcgv6i4c3art5.
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This paper presents evidence on the role of ownership in dealing with corporate expropriation of listed companies in Malaysia. From the perspective of expropriation, a single controlling shareholder is always associated with such behavior due to their power and control at the expense of minority shareholder. However, subsequent individual or coalition of large shareholders can be an important corporate governance tool by providing effective monitoring that would lessen the possibility of expropriation by the controlling shareholder. Relating to that, this study evaluates the role of controlling and large shareholders in dealing with corporate expropriation. It is found that there is a negative relationship between single controlling shareholders and dividend payout ratio indicating that firms with only controlling shareholder will pay a lower dividend due to possible expropriation through profit diversion by controlling shareholder. Using Herfindahl Index as a proxy for ownership contestability, the presence of large shareholders along with controlling shareholder has a positive relationship with dividend payout implying that increased contestability helps to curb the power of controlling shareholder to expropriate fund for their own benefit. In accordance with agency theory, the outcome suggests that large shareholders play a monitoring role in minimizing the Type II agency problem. It is also verifying the argument made based on the Catering Theory of Dividend that the presence of large shareholder brings benefit to all shareholders as they are able to reduce profit diversion by demanding for higher dividend.
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Goto, Gen. "Legally "Strong" Shareholders of Japan." Michigan Business & Entrepreneurial Law Review, no. 3.2 (2014): 125. http://dx.doi.org/10.36639/mbelr.3.2.legally.
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Foreign investors often criticize Japanese corporations for not paying enough attention to the interests of their shareholders. It might surprise these critics, then, to learn that shareholders’ legal rights under the Japanese Companies Act are actually quite strong. Indeed, many of the rights that shareholders’ rights advocates often support, including shareholders’ power to alter a corporate charter without board consent, shareholders’ power to control dividend payments, majority voting for board elections, shareholders’ power to replace the board of directors, and shareholder access to a corporate ballot—all of which are strongly debated elsewhere— are already effective in Japan. Moreover, derivative suits are easily initiated and maintained. Shareholders of Japanese corporations are, therefore, in an arguably stronger position than those in, for example, the United States. Still, notwithstanding these Japanese statutory rights, foreign investors’ criticisms persist. Two questions arise from this debate. First, why are shareholders of Japanese corporations unable to leverage their strong rights to force corporate management to prioritize shareholders’ interests? Alternatively, why are shareholder activists inactive in Japan? Second, if the existing shareholders’ rights are not actually used for activism, are they completely meaningless? Or, do they have alternative effects, whether positive or negative? This article answers these questions by summarizing and categorizing the rights of shareholders of Japanese corporations into two characteristics. First, shareholders of Japanese corporations have strong class-based rights with respect to decision-making on a wide range of matters related to the corporation and ample opportunity to take an initiative. These rights might, in fact, be too strong, inducing managers to insulate themselves by engaging in so-called “cross-shareholding” (kabushiki mochiai) relationship, which in turn likely weakens the rights of other shareholders in practice. The lack of support provided to activist shareholders by other shareholders, especially those in these cross-shareholding relationships, is the primary cause of activist ineffectiveness in Japan. When cross-shareholdings are unwound, however, these shareholder rights function as a latent threat on managers, disciplining them. The keys to ensuring that classbased shareholder rights are meaningful are, thus, distribution of share ownership and restraint on management’s attempt to manipulate this distribution. Unfortunately, it is not easy to unwind already-established crossshareholdings through regulatory intervention. Second, shareholders also possess strong individual rights to raise issues with the corporation, either by asserting a shareholder proposal or filing a derivative suit, neither of which would the corporation disrupt for the interest of other shareholders. These rights, again, might be too strong, incentivizing individuals to take advantage of them in pursuit of personal goals, rather than for the good of the corporation. Yet, whether the use of these individual rights amounts to an abuse hinges on an evaluation of the benefits achieved, namely, the supply of diverse views through shareholder proposals and the deterrence effect of derivative suits. Possible future reforms to Japanese law ought to consider how to strike the right balance of power for shareholders of Japanese corporations.
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Alikaj, Albi, and Aditya Limaye. "The Impact of Legal Systems on Dividend Payments." Studies in Business and Economics 16, no. 1 (April 1, 2021): 5–11. http://dx.doi.org/10.2478/sbe-2021-0001.
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Abstract This paper focuses on the amount of dividends paid to shareholders by companies in different countries and examines whether being in a country where the legal system offers weak shareholder protection affects dividend payments distributed to shareholders. The sample used for this study comprises 8,045 companies from 46 countries. Seven individual factors affecting shareholder protection were examined. Out of the seven factors, only two of them provide a significant relationship with dividend payments, and more specifically, the mechanisms put in place by companies to protect oppressed minority shareholders as well as minimum percentage share of capital in order for the shareholders to be eligible to call an extraordinary shareholder meeting.
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Thangaveloo, Arasu, Magiswary Dorasamy, Abdul Aziz Bin Ahmad, Siva Barathi Marimuthu, and Jayamalathi Jayabalan. "Corporate governance and shareholders’ confidence in cooperative corporations: a systematic literature review." F1000Research 11 (February 3, 2022): 144. http://dx.doi.org/10.12688/f1000research.73317.1.
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Background: The confidence of Bottom 40 (B40) shareholders is crucial for cooperative corporation’s sustenance within wider corporate governance. An in-depth study on cooperatives is needed, as they play a crucial role in the Malaysian economic system and contribute greatly to the country’s social development. However, in the current landscape, confidence among shareholders is at stake. This study aims to identify the research gap into corporate governance for cooperative corporations in relation to B40 shareholder confidence, as well as identify current study challenges and develop a conceptual framework for future research. Methods: We conducted a systematic literature review, with the use of agency theory to assess shareholders’ confidence. Emerald, ProQuest, InderScience, Scopus and Science Direct were the online databases used in this study to search five keyword phrases: corporate governance, confidence, cooperative, agency theory and Bottom 40% (B40) household. Tranfield’s five stages were used to conduct the systematic review. Results: Only 5 of the 324 studies assess shareholders’ confidence in cooperatives, as well as one paper on B40 and two papers on agency theory. Our review presents three major findings. First, research in the context of B40 shareholder’s confidence in cooperative corporations is limited. Second, the challenges related to shareholders’ confidence in B40 are major issues in the context. Third, research on agency theory in the context of shareholders’ confidence within cooperative corporations and corporate governance is still scant. Conclusions: This review urges the research community to conduct more studies based on the highlighted research gaps.
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Thangaveloo, Arasu, Magiswary Dorasamy, Abdul Aziz Bin Ahmad, Siva Barathi Marimuthu, and Jayamalathi Jayabalan. "Corporate governance and shareholders’ confidence in cooperativess a systematic literature review." F1000Research 11 (March 10, 2022): 144. http://dx.doi.org/10.12688/f1000research.73317.2.
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Background: The confidence of Bottom 40 (B40) shareholders is crucial for cooperative’s sustenance within wider corporate governance. An in-depth study on cooperatives is needed, as they play a crucial role in the Malaysian economic system and contribute greatly to the country’s social development. However, in the current landscape, confidence among shareholders is at stake. This study aims to identify the research gap into corporate governance for cooperatives in relation to B40 shareholder confidence, as well as identify current study challenges and develop a conceptual framework for future research. Methods: We conducted a systematic literature review, with the use of agency theory to assess shareholders’ confidence. Emerald, ProQuest, InderScience, Scopus and Science Direct were the online databases used in this study to search five keyword phrases: corporate governance, confidence, cooperative, agency theory and Bottom 40% (B40) household. Tranfield’s five stages were used to conduct the systematic review. Results: Only 5 of the 324 studies assess shareholders’ confidence in cooperatives, as well as one paper on B40 and two papers on agency theory. Our review presents three major findings. First, research in the context of B40 shareholder’s confidence in cooperatives is scarce. Second, the challenges related to shareholders’ confidence in B40 are major issues in the context. Third, research on agency theory in the context of shareholders’ confidence within cooperatives and corporate governance is still scant. Conclusions: This review urges the research community to conduct more studies based on the highlighted research gaps.
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Thangaveloo, Arasu, Magiswary Dorasamy, Abdul Aziz Bin Ahmad, Siva Barathi Marimuthu, and Jayamalathi Jayabalan. "Corporate governance and shareholders’ confidence in cooperatives: a systematic literature review." F1000Research 11 (March 4, 2024): 144. http://dx.doi.org/10.12688/f1000research.73317.3.
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Background The confidence of Bottom 40 (B40) shareholders is crucial for cooperative’s sustenance within wider corporate governance. An in-depth study on cooperatives is needed, as they play a crucial role in the Malaysian economic system and contribute greatly to the country’s social development. However, in the current landscape, confidence among shareholders is at stake. This study aims to identify the research gap into corporate governance for cooperativess in relation to B40 shareholder confidence, as well as identify current study challenges and develop a conceptual framework for future research. Methods We conducted a systematic literature review, with the use of agency theory to assess shareholders’ confidence. Emerald, ProQuest, InderScience, Scopus and Science Direct were the online databases used in this study to search five keyword phrases: corporate governance, confidence, cooperative, agency theory and Bottom 40% (B40) household. Tranfield’s five stages were used to conduct the systematic review. Results Only 5 of the 324 studies assess shareholders’ confidence in cooperatives, as well as one paper on B40 and two papers on agency theory. Our review presents three major findings. First, research in the context of B40 shareholder’s confidence in cooperatives is scarce. Second, the challenges related to shareholders’ confidence in B40 are major issues in the context. Third, research on agency theory in the context of shareholders’ confidence within cooperatives and corporate governance is still scant. Conclusions This review urges the research community to conduct more studies based on the highlighted research gaps.
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Søndergaard Birkmose, Hanne. "Forcing Shareholder Engagement: Theoretical Underpinning and Political Ambitions." European Business Law Review 29, Issue 4 (July 1, 2018): 613–42. http://dx.doi.org/10.54648/eulr2018024.
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This paper explores the post-crisis debate on shareholder engagement and argues that the debate and subsequent legislative initiatives aimed at increasing shareholder engagement and accountability seem to be moving away from the traditional corporate governance basis. While corporate governance theory may explain the need for shareholders to balance management powers, it does not support that shareholders have an obligation to engage in investee companies. Neither do we find that the ownership rhetoric supports any duties for shareholders. Finally, we examine elements of stakeholder theory and public policy theory. While these theories emphasise that companies should include other interests than shareholders’ financial interests, they do not support a stronger shareholder role in that respect. Thus, the paper concludes that the post-crisis debate on shareholder engagement should be seen as the result of a strong political agenda and that the theoretical basis for pushing shareholder engagement further is weak.
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Zhou, Tingting. "Partial privatization, control rights of large shareholders and privatized shares transfer." Nankai Business Review International 9, no. 4 (November 5, 2018): 472–99. http://dx.doi.org/10.1108/nbri-11-2017-0060.
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Purpose The partial privatization of state-owned enterprises (SOEs) is a dynamic process. The main feature of this process lies in not only gradual and sequential privatizations but also privatized shares transfer. For partially privatized SOEs, the introduction of private sector ownership is not the end of the story because the previously introduced private owners may choose to leave the SOEs by transferring the privatized shares after privatization, a process that is called “privatized shares transfer”. This paper aims to investigate the determinants of privatized shares transfer (PST) from the perspective of large shareholders’ control rights. Design/methodology/approach Considering the pyramidal structure of Chinese listed companies, this paper extends existing analyses to study the impact of the ultimate controller’s control rights on privatized shares transfer. This paper also investigates the relationship between excessive control rights of the largest controlling shareholder and PST in view of the principle of equity of rights and obligations. In addition to a perspective on the holding of key positions by large shareholders, this paper further explores the impacts of the ownership of the largest controlling shareholder on privatized shares transfer. Findings The results capture the fact that the higher control rights of large shareholders lead to more privatized shares transfer. After exploring the impacts of excessive control rights, the results provide evidence supporting the idea that firms with excessive numbers of directors, senior managers or supervisors who also have positions in the largest controlling shareholder’s entity are more likely to transfer privatized shares owned by private owners. In addition, the largest shareholders’ ownership also plays a role in privatized shares transfer. Originality/value This evidence suggests that the large shareholders’ control rights should be limited to an appropriate range during the process of privatization, thereby giving private shareholders more opportunity to participate in the operation of firms, strengthen the state and enhance the competitiveness of state capital.
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Ekholm, Anders, and Benjamin Maury. "Portfolio Concentration and Firm Performance." Journal of Financial and Quantitative Analysis 49, no. 4 (August 2014): 903–31. http://dx.doi.org/10.1017/s0022109014000635.
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AbstractThis paper investigates the relation between shareholders’ portfolio concentration and firm performance. Using data on more than 1.3 million unique shareholders, we create an index that measures how concentrated shareholder portfolios are in each firm. We posit that portfolio concentration will affect incentives when shareholders are resource constrained. We find that average shareholder portfolio concentration is positively related to future operational performance and valuation. We also find that portfolio concentration is positively correlated with abnormal stock returns. Our findings suggest that shareholders with concentrated portfolios are more informed and play a governance role through the stock market.
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LEDENEV, VIKTOR. "BUSINESS JUDGEMENT OF MAJORITY SHAREHOLDER RULE IN CONTEXT OF LEGAL NATURE OF NON-PUBLIC COMMERCIAL CORPORATION." Sociopolitical Sciences 12, no. 4 (August 2022): 97–102. http://dx.doi.org/10.33693/2223-0092-2022-12-4-97-102.
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Goal. In the article we research applicability of business judgement rule to actions of a majority shareholder taking in the account specificities of non-public commercial corporations. Analysis of application of the rule to a majority shareholder’s actions in view of non-public corporation’s legal nature was conducted only in the Peeples’ paper [13]. However, this analysis fails to take into the account ability of shareholders of corporations to apply informal sanctions against each other. The goal of this article is to supplement current understanding of legal nature of non-public corporation and to elaborate additional grounds for application of the rule. Inferences. In the article we confirm the conclusion that justification of application of the rule in non-public corporations has specificities derivative from the legal nature of such corporations. Besides that, we conclude that the rule’s application may depend upon ability of shareholders to deter opportunistic behavior by informal sanctions. Value. The article for the first time proves that the legal nature of non-public corporations depends not only upon trust between shareholders, but from their ability to apply informal sanctions as a mean of protection from opportunistic behavior of a counteragent. Given this, we suppose that the state’s role in protection of rights and interests of minority shareholders may be decreased.
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Kwon, Sang-Ro. "A Study on Virtual Shareholders' Meetings under the German COVID-19 Pandemic-related Act." Legal Studies Institute of Chosun University 29, no. 3 (December 31, 2022): 103–33. http://dx.doi.org/10.18189/isicu.2022.29.3.103.
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With the Act on Measures in Corporate, Cooperative, Association, Foundation, and Home Ownership Law to Combat the Effects of the COVID-19 Pandemic, virtual shareholders' meetings were temporarily held in Germany. Overall, shareholders' participation in general meetings increased. However, shareholders' right to speak and ask questions was not guaranteed, raising the issue of infringement of shareholders' rights and the risk of resolution cancellation at general shareholders' meetings. Besides, there has been skepticism about continuing to hold virtual shareholders' meetings after the end of the COVID-19 pandemic. In Korea, due to the COVID-19 pandemic, the idea of virtual shareholders' meetings, instead of on-site meetings that require physical attendance, gained more support. However, as in the German case, if shareholders' right to speak and ask questions is not guaranteed, virtual shareholders' meetings can create a social issue. Successful settling of the virtual general shareholders' meeting system requires technical and institutional support. If Korea reflects on the issues raised in the German experience of holding virtual general shareholders’ meetings to improve the institutional system, it will maximize the advantages of virtual meetings while reducing trial and error. First, virtual shareholders' meetings need promotion as an arena of shareholder discussion that is shareholder friendly. Moreover, companies must establish an adequate online system to run virtual shareholders’ meetings seamlessly. If shareholders are denied chances to ask questions at the virtual meetings, it will restrict their informational rights. More questions from shareholders may naturally interfere with the virtual meetings, and some may intentionally abuse this. Notably, shareholders who accessed the meeting online may ask questions more frequently than at on-site meetings. Nevertheless, it is not desirable to block questions from shareholders. A moderator should manage the number of questions (to fit in the given time) and guarantee shareholders’ right to ask questions.
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Zhang, Zhibin, Lishu Zhang, and Aihua Xiong. "The influence of non-state-owned shareholder governance on the governance level of state-owned enterprises——Based on the perspective of board resolution behavior and party organization governance." PLOS ONE 19, no. 5 (May 2, 2024): e0301788. http://dx.doi.org/10.1371/journal.pone.0301788.
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With an increasing number of heterogeneous shareholders participating in corporate governance in reality, the assumption of shareholder homogeneity in agency theory is gradually relaxing in the modern field of corporate governance. The policy of mixed ownership reform in China provides empirical evidence for studying heterogeneous shareholder governance. To fully understand the governance effects of non-state shareholders, we employ the ownership proportion held by non-state shareholders among the top ten shareholders and the appointment of directors as measures for non-state shareholder governance. Using a panel fixed-effect model from the perspective of state-owned enterprises (SOEs) party organizations, we examine the impact of non-state shareholder governance on the governance level of SOEs. The study reveals that non-state shareholder governance positively affects the governance level of SOEs, with board resolutions playing a crucial role in this relationship. When party members serve as directors, the governance effect of non-state shareholders is more significant. Based on the aforementioned research findings, we recommend further refining corporate governance measures for SOEs within the context of SOE reforms. It is advisable to optimize the party organizational governance structure and leverage the synergistic effects of non-state shareholder governance and party organizational governance. Advancing reforms along the Pareto improvement path will contribute to establishing a distinctive corporate governance system for Chinese SOEs.
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Liu, Ruijie, and Yajing Huang. "Structural Analysis of Projected Networks of Shareholders and Stocks Based on the Data of Large Shareholders’ Shareholding in China’s Stocks." Mathematics 11, no. 6 (March 22, 2023): 1545. http://dx.doi.org/10.3390/math11061545.
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This paper establishes a shareholder-stock bipartite network based on the data of large shareholders’ shareholding in the Shanghai A-share market of China in 2021. Based on the shareholder-stock bipartite network, the statistically validated network model is applied to establish a shareholder projected network and a stock projected network, whose structural characteristics can intuitively reveal the overlapping portfolios among different shareholders, as well as shareholder allocation structures among different stocks. The degree of nodes in the shareholder projected network obeys the power law distribution, the network aggregation coefficient is large, while the degree of most nodes in the stock projected network is small and the network aggregation coefficient is low. Furthermore, the two projected networks’ community structures are analyzed, respectively. Most of the communities in the shareholder projected network and stock projected network are small-scaled, indicating that the majority of large shareholders hold different shares from each other, and the investment portfolios of large shareholders in different stocks are also significantly different. Finally, by comparing the stock projected sub-network obtained from the shareholder-stock bipartite sub-network in which the degree of shareholder nodes is 2 and the original stock projected network, the effectiveness of the statistically validated network model, and the community division method on the research of the shareholder-stock bipartite network are further verified. These results have important implications for understanding the investment behavior of large shareholders in the stock market and contribute to developing investment strategies and risk management practices.
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Marquez, Robert, and Bilge Yılmaz. "Takeover Bidding and Shareholder Information." Review of Corporate Finance Studies 1, no. 1 (July 25, 2012): 1–27. http://dx.doi.org/10.1093/rcfs/cfs004.
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We study the role of shareholder information during the acquisition of widely held firms. When target shareholders share the same information about the post-takeover value, increasing the precision of information has no effect on the expected acquisition price. However, more precise information aggravates the free-rider problem, allowing shareholders to better discern when it is worthwhile to hold out rather than tender their shares. By contrast, when information is dispersed among shareholders, providing shareholders with superior information induces the raider to offer higher prices, thus increasing shareholder value. However, in this case, neither prices nor tendering decisions aggregate any information. (JEL G34, D82)
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Kirui, Vincent Kipngetich, Gilbert Onchangwa, and Julius Mironga. "Effect of Firms’ Soundness on Shareholders’ Earnings of Listed Firms at the Nairobi Securities Exchange, Kenya." International Journal of Social Science and Humanities Research (IJSSHR) ISSN 2959-7056 (o); 2959-7048 (p) 1, no. 1 (October 31, 2023): 510–24. http://dx.doi.org/10.61108/ijsshr.v1i1.44.
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The global changes in the business environment and the increased demand for improved shareholder’s earnings have prompted big firms to re-examine their soundness. During the 2008 global economic crisis, many big institutions experienced challenges like liquidity challenges, poor leverage, and drop in share prices and decline in assets which led to the decline in the earnings of shareholders. current study was therefore necessary to analyse the effect of firm’s soundness on shareholders earnings of listed firms at the Nairobi Securities Exchange. The specific objectives of the study were: To evaluate the effect of liquidity on the shareholders earnings of firms listed at Nairobi securities exchange, Kenya, to establish the effect of firm size on shareholders earnings of firms listed at Nairobi securities exchange, Kenya, to examine the effect of leverage on shareholders earnings of firms listed at Nairobi securities exchange, Kenya and to analyse the effect of firm’s age on shareholders earnings of firms listed at the Nairobi securities exchange, Kenya. This study is expected to assist businesses in comprehending the soundness that must be emphasized in order to avoid financial losses. As a result, it assist in informing the policies of listed companies in terms of liquidity, leverage, and assets, which is a measure of the firm's size. Firms should be able to develop a policy that improves shareholder earnings based on soundness. Finally, it is expected that shareholders and other potential investors will benefit from a clear understanding of the factors that influence earnings per share within the company. The Modigliani and Miller theory, as well as the Agency theory, were used to guide the research. A descriptive research design was used in this study. The study's target population was all listed companies on the Nairobi Securities Exchange over the period 2015 to 2021. The 64 companies were analyzed using the census study. Data had been collected using a secondary data collection sheet. The study employed secondary data obtained from the published financial statements of the respective firms, from the Nairobi Securities Exchange and the Capital Markets Data. A panel regression model was employed in the analysis of data with the aid of the stata version 14. The study found out that Liquidity had a positive significant effect on the shareholders earnings In addition, firms’ size had a significant and positive effect on the shareholders ‘earnings. Moreover, Leverage had a non significant positive effect on the shareholders earnings .The firms’ age on the other hand has a positive and significant effect on the shareholders earnings.
The study recommends the following based on the findings. First the listed firms should enhance its liquidity by investing more on liquid assets. This should entail more investments in treasury bills, treasury bonds and other liquid stocks. They should also diversify their investments by investing in money markets. Additionally it should enhance its liquidity by controlling its overheads through getting rid of unnecessary expenses. Secondly, the listed firms needs to expand its asset base. As seen from the findings, firms size had a significant effect on the shareholder’s earnings meaning that the higher the size in terms of total assets, the higher the shareholders earnings. Firms should therefore expand its assets base by developing new products for the customers, increasing its customer base while expanding to new markets. Thirdly, the findings also indicate that firm’s age has a significant effect on the shareholder’s earnings. To sustain its performance and shareholder’s earnings, firms that have been in operation for many years compared to the rest should harness on the experience and economies of scale to ensure that they are able to sustain their performance. This should entail a thorough trend analysis of its performance over the years and designing better strategies based on the past challenges and its internal strengths.
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Chen, Anlin, Lanfeng Kao, and Yi-Kai Chen. "Agency Costs of Controlling Shareholders' Share Collateral with Taiwan Evidence." Review of Pacific Basin Financial Markets and Policies 10, no. 02 (June 2007): 173–91. http://dx.doi.org/10.1142/s021909150700101x.
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Controlling shareholders' share collateral is a new source of the deviation of cash flow rights and control rights leading to minority shareholder expropriation. However, controlling shareholders' share collateral is not forbidden and has not received particular restriction leading to its popularity in the capital markets. Neglecting the potential agency costs resulting from controlling shareholders' share collateral would hurt the interests of creditors and minority shareholders. We need legal regulation on controlling shareholders' share collateral to reinforce corporate governance mechanism to protect the interests of creditors and minority shareholders.
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Sukarmo, I. Gde, Hayyanul Haq, Zainal Asikin, and Salim HS. "Minority Shareholders’ Legal Protection in a Limited Liability Company System." Journal of Siberian Federal University. Humanities & Social Sciences 14, no. 11 (November 2021): 1606–12. http://dx.doi.org/10.17516/1997-1370-0843.
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The purpose of this study is to determine the legal protection model for the majority and minority shareholders in public limited companies. This research method is normative research. To investigate the ineffectiveness of laws and regulations, in particular, Law No. 40 of 2007 on limited liability companies in providing shareholder protection, researchers have studied the laws and regulations and considered the views of experts on legal concepts related to legal protection for shareholders, particularly, minority shareholders. The results showed that the law did not provide maximum legal protection for minority shareholders, creating an imbalance between the rights of the minority and majority shareholders. For this reason, 1) reform or progressive changes in laws and regulations are needed, for instance, in PT Law No. 40 of 2007. These changes should be fundamental to philosophical aspects (values and perspectives) in providing shareholder protection; 2) the review of shareholders’ protection methods should be based on the aspects of fairness
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Mukhamedkarim, Zhibek. "Do the Minority Shareholders of Russian Corporations Need More Protection?" European Company Law 19, Issue 1 (February 1, 2022): 11–21. http://dx.doi.org/10.54648/eucl2022003.
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Russian corporate governance has traditionally been viewed as lacking in contrast to that of Western states. The major concern has been controlling shareholders’ expropriation of minority shareholders, especially in the setting of state-owned enterprises (SOEs). However, in recent years, the law and court treatment of minorities’ rights have taken a positive turn, drawing more investors to joint-stock companies (JSC), the Russian equivalent of US corporations. This article examines whether such developments sufficiently protect minority shareholders’ interests in the areas of (1) access to information, (2) controlling shareholder transactions, (3) takeovers by a controlling shareholder, and (4) dividend distributions. This article examines the formation and current state of the law and court practice in these areas, and proposes legislative reform, where appropriate. The article concludes that, although there is room for improvement, the law and the courts generally afford sufficient protections to minority investors, but the key factor that may boost the quality of corporate governance is minority shareholders’ active participation in corporate affairs, especially in the general meetings of shareholders. corporate governance, minority shareholder protection, Russian corporate law
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Su, Kun, and Peng Li. "The Effects Of Ultimate Controlling Shareholders On Debt Maturity Structure." Journal of Applied Business Research (JABR) 29, no. 2 (February 13, 2013): 553. http://dx.doi.org/10.19030/jabr.v29i2.7656.
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Using a balanced panel data of 915 Chinese listed firms, this paper studies the effect of ultimate controlling shareholders on debt maturity structure by adopting random effect model. Our results show: the larger the ultimate controlling shareholders cash flow rights, the higher the cost of expropriating outside investors by ultimate controlling shareholder, and can reduce the agency costs of debt financing, so banks are willing to provide more long term debt funds for the firms. Ultimate controlling shareholders cash flow rights are positively related to debt maturity structure. The larger the divergence between ultimate controlling shareholders control rights and cash flow rights, the more likely of ultimate controlling shareholder to expropriate outside investors, and this increase the agency conflicts between firms and creditor, which leading to higher agency costs of debt financing, so banks tend to provide more short term funds for firms to constrain the ultimate controlling shareholder. The divergence between ultimate controlling shareholders controlling rights and cash flow rights are negatively related to debt maturity structure.
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Antonius Siahaan, Yosman Bustaman, and Indah Larisa Sari. "Ownership Concentration, Corporate Liquidity, and Dividend Payment Policy: Evidence from Indonesian Financial Industries." International Journal of Business and Society 21, no. 3 (April 27, 2021): 1310–21. http://dx.doi.org/10.33736/ijbs.3351.2020.
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The main objective of this research is to analyze the effect of ownership concentration and corporate liquidity on dividend payment policy in the Indonesian financial industry. Dividend payment is measured using dividend pay-out ratio on measuring dividend payment. Corporate ownership concentration is measured using the number of shares held by legal individual investors and large block shareholders. Ownership concentration is divided into three categories, which are inside shareholders, stable shareholders, and market shareholders. Corporate liquidity is measured by corporate profit, defined by retained earnings/total assets and retained earnings/total equity, corporate leverage (total liabilities/total assets), and corporate size (log normal total assets). We apply data panel regression and the robust least square method. Based on the robust least square method of testing data panel regression, we find there is a relationship between insider shareholder, market shareholder, and dividend payment policy. In contrast, there is no relationship between stable shareholder and dividend payment policy. We also found a relationship between corporate profit, which variable is retained earnings/total assets, corporate leverage, and corporate size, and dividend payment policy. These results lead to the conclusion that dividend payments increase when ownership by inside shareholders decreases, and that when ownership by market shareholders increase corporate profit will also increase, and corporate leverageand corporate size decreases.
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Emanuella, Hamanda Tiara. "Perlindungan Hukum Pemegang Saham Minoritas PT (Persero) dalam Pembentukan Anak Perusahaan BUMN." MLJ Merdeka Law Journal 2, no. 2 (November 20, 2021): 100–109. http://dx.doi.org/10.26905/mlj.v2i2.7166.
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BUMN (Persero) is regulated in UU 19 of 2003 on BUMN. BUMN hold 50% or more of share as a major controlled, the minority share can be owned by other parties with IPO mechanism. BUMN is including the subject of Law Number 40 of 2007 on Limited Liability Company, which specifically regulates the rights of shareholders. However, the problem is related to when the BUMN carrying out its business activities establishes a subsidiary based on the decision of the GMS, where the majority shareholder who is the largest shareholder is on the side of him, which makes the rights of the minority shareholder neglected. The purpose of this study is to analyze the pattern of protection for minority shareholders of Limited Liability Company according to Corporat Law system and the legal remedies of minority shareholders in protecting their rights to action. This research is a normative legal research with descriptive analytical research. The result of this study is that legal protection for minority shareholders of BUMN is regulated in BUMN Law and Limited Liability Company Law but there are the rights of these shareholders which are only fulfilled if they receive support from the majority shareholder, so that the sense of justice of minority shareholders is not protected. , however, there are efforts to settle disputes that can be taken both litigation and non-litigation, especially Acts against the Law (1365 BW) with the mechanism regulated in the Law on Company LawDOI: https://doi.org/10.26905/mlj.v2i2.7166
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Gabov, Andrey V. "Exemption of a joint stock company from the obligation to provide information to a shareholder." Law Enforcement Review 4, no. 3 (October 5, 2020): 103–22. http://dx.doi.org/10.24147/2542-1514.2020.4(3).103-122.
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The subject of research. Issues concerning the exercise of the right of shareholders to receive information are analyzed. The focus is on the issues of exemption of a joint-stock company from providing information. The development of the institute of the information provision to shareholders by joint stock companies are consistently analyzed. The main trends in the development of this institute are shown: gradually narrowing the ability of shareholders to exercise their right to receive information through such means as restriction, differentiation and exemption from providing information. Special emphasis is placed on the institute of exemption from providing information. The purpose of the article is to show the main drawbacks of the existing model of exemption of a joint-stock company from the obligation to provide information to shareholders and to formulate directions for the development of legislation. The author's main scientific hypothesis can be summarized as follows. The Federal law «On joint-stock companies» contained an initial defect in the description of information exchange between a shareholder and a joint-stock company. The shareholder's right to information was not described, in fact, it was «embedded» in the obligation of the joint-stock company to provide information. The subsequent changes to the law resulted in a narrowing of the rights of the shareholder, practically depriving the minority shareholder of the right to information. This defect has led to significant legal uncertainty when the joint-stock company exercises its right to be exempt from providing information. This uncertainty should be eliminated, because the regulatory goals for granting joint-stock companies an exemption from the obligation to provide information to shareholders (article 92.2 of the Federal law «On joint-stock companies» that counters sanctions pressure) are absolutely correct. At the same time, some of the grounds for exemption from the obligation to provide information to shareholders (article 92.1 of the Federal law «On joint-stock companies») must either be excluded or reformulated. The author notes the complete «break» between the current regulation and the ideas about information exchange between a shareholder and a joint-stock company, that initially inspired the creation of the law on joint-stock companies. The inclusion of sanctions in the law on joint - stock companies as a factor affecting the performance by a joint-stock company of its obligation to provide information to shareholders should be fully welcomed. However, the legal and technical design of the corresponding political and legal idea cannot be considered optimal. In this part, the legislation requires a complete renovation based on the principle of balancing constitutional values and the interests of the state, majority and minority shareholders. Description of research methodology. The research is based on a systematic analysis, as well as the interpretation of Russian legislation and doctrine. Information about the main scientific results. The development of legislation on joint-stock companies in terms of providing information is shown. It is shown that if legislator taking into account sanctions when regulating the obligation of a joint-stock company to provide information, the goals of legislative regulation fully comply with constitutional principles, but specific legal decisions cannot be considered optimal. Conclusions. It is concluded that development of legislation on joint-stock companies has led to a significant restriction of the ability of shareholders to receive information. The author formulated the priority of regulatory goals in countering sanctions pressure and offered specific directions for improving legal regulation.
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Rutterford, Janette. "The Shareholder Voice: British and American Accents, 1890–1965." Enterprise & Society 13, no. 1 (March 2012): 120–53. http://dx.doi.org/10.1017/s1467222700010958.
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This article discusses the interaction between directors and small shareholders who made up the majority of names on the share ledgers of many companies in both the UK and the USA. It is concerned with the period 1890–1965 and concentrates on the management/shareholder relationship in the context of the annual general meeting and shareholder activism. I argue that there were significant differences between shareholder activism in the UK and the USA, due to the difference in relative numbers of the shareholders themselves, to legal and geographic differences, to corporate culture, and to the earlier diffusion of shareholding in the UK compared to the USA. UK shareholders concentrated their interventions on management issues, as well as some social and labor matters. US shareholders, mostly through so-called ‘corporate gadflies’, concentrated their efforts on corporate governance issues, some of which were already enshrined in UK company law and practice.
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Tang, Zhiyuan. "A Study on the Guarantee of Chinese One-man Company for Its Shareholders." Northeast Asian Business and Economics Association 4, no. 1 (May 31, 2023): 37–46. http://dx.doi.org/10.51156/jnabe.2023.4.1.37.
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Purpose - Research the legality of one member company’s shareholder guarantee. First of all, as far as the legislative purpose of the decision-making power of the shareholders’ meeting and the procedure for shareholders to avoid voting under the special guarantee stipulated in the Company Law of China is concerned, its legislative purpose is to prevent major shareholders from abusing their rights, protection of the Company and minority shareholders.
Design/Methodology/Approach - There is no difference between large and small shareholders in a one-person company. The only shareholder of a one-person company is the only participant in the company’s operation and decision-making, who has the most direct understanding of the company’s operation, and has the most clear judgment on the company’s major issues. The oneness of the shareholders of a human company makes their behavior not only represent the will of shareholders, but also reflect the will of the company.
Findings - Therefore, the Company Law does not deny the legality of one person’s company’s guarantee for shareholders. Secondly, the current Company Law has legally confirmed the full guarantee capacity of the company, and it is legitimate for the company to provide guarantees for others, shareholders or actual controllers of the company.
Research Implications - Based on not violating the relevant principles of the Company Law, one person company’s provision of security for its shareholders belongs to the territory of “company autonomy”. As long as its procedures are legitimate, its behavior naturally has legitimacy.
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Cullinan, Charles P., Lois S. Mahoney, and Pamela Roush. "Corporate social responsibility and shareholder support for corporate governance changes." Social Responsibility Journal 12, no. 4 (October 3, 2016): 687–705. http://dx.doi.org/10.1108/srj-10-2015-0161.
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Purpose This paper examines whether shareholders consider corporate social responsibility (CSR) performance when voting on corporate governance change proposals submitted by dissident shareholders. These proposals recommend changes to the corporate governance status quo and are made by dissident shareholders who are dissatisfied with the company’s existing governance practices. Design/methodology/approach Using 195 governance change proposals voted on during 2013, the paper examines the relationship between CSR performance (obtained from the MSCI database) and the level of voting support for these proposals. Findings This study finds that shareholder support for corporate governance change proposals submitted by dissident shareholders is positively related to firms’ CSR concerns, especially environmental concerns. Research limitations/implications The findings suggest that shareholders may be concerned with the potentially adverse effects of weak CSR performance, especially poor environmental performance, and may support changes to corporate governance structures when a company’s CSR and environmental performance is weaker. Originality/value As the first research to examine the relationship between CSR and proposed changes to corporate governance, this study provides unique insights into shareholder perceptions of the value of CSR based on shareholders’ support (or lack thereof) for governance changes proposed by dissident shareholders.
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Purwanti, M. M. Fajar, Fadlan Fadlan, and Siti Nurkhotijah. "Juridical Analysis of Shareholder Agreement Letters as a Form of Legal Protection (Research Study in Companies in Batam City)." QISTINA: Jurnal Multidisiplin Indonesia 2, no. 2 (December 1, 2023): 1523–29. http://dx.doi.org/10.57235/qistina.v2i2.1346.
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Private companies are one of the main pillars of the national economy in sustainable national development. In carrying out business activities, conflicts often occur between the shareholders of a company. The governance of a company is regulated in Law Number 40 of 2007. The reality of the business world is that often the articles of association in the deed of establishment of a Limited Liability Company as a place to accommodate the clauses agreed to by the shareholders cannot accommodate clauses that are specific to the objectives of the shareholders. shares to manage the running of the Limited Liability Company business they established. This research uses empirical juridical methods. The data used uses secondary data taken as primary data from the collection of laws and regulations relating to the object under study, and secondary and tertiary data from official documents, journals and the internet. Data collection was carried out by means of one-sided questions and answers which was carried out systematically and based on the research objectives. From the results of this research, data was obtained that Limited Liability Companies located in the city of Batam do not pay attention to company governance procedures as regulated in the articles of association in the company's Deed of Establishment, thus providing opportunities for misuse of this trust. Progress in business governance is not well anticipated, which creates gaps in increasing conflict between shareholders in the company. The choice of litigation resolution, which takes a long time and is expensive, is an obstacle to resolving this conflict. The Shareholders' Agreement Letter as a mitigation for future conflict management for the shareholders of a Limited Liability Company should be used from the moment the shareholder's self-binding agreement was made when establishing the company. A shareholder agreement is a legal document that regulates the relationship between the company's shareholders, which concerns their interests or the interests of the Company. Explicitly in UUPT no. 40 of 2007, Article 4 states that this law, the Company's articles of association and other statutory provisions, Article 1320 concerning the validity of agreements, Article 1338 of the Civil Code, binding agreements as law for the founders, applies to the Limited Liability Companies. A shareholder agreement letter is an agreement made in addition to the Articles of Association made by the parties.
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Akyol, Ali C., Wei Fen Lim, and Patrick Verwijmeren. "Shareholders in the Boardroom: Wealth Effects of the SEC’s Proposal to Facilitate Director Nominations." Journal of Financial and Quantitative Analysis 47, no. 5 (June 14, 2012): 1029–57. http://dx.doi.org/10.1017/s0022109012000373.
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AbstractCurrent attempts to reform financial markets presume that shareholder empowerment benefits shareholders. We investigate the wealth effects associated with the Securities and Exchange Commission’s rule to facilitate director nominations by shareholders. Our results are not in line with shareholder empowerment creating value: The average daily abnormal returns surrounding events that increase (decrease) the probability of the proposal’s passage are significantly negative (positive). Furthermore, given an increase in the probability of the proposal’s passage, firms whose shareholders are more likely to use the rule to nominate directors experience more negative abnormal returns.
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Čulinović-Herc, Edita, and Sonja Marinac Rumora. "Regulation of legal relationship between shareholders in closely held companies on the example of the Croatian limited liability company ." Zbornik Pravnog fakulteta Sveučilišta u Rijeci 39, no. 1 (2018): 45–90. http://dx.doi.org/10.30925/zpfsr.39.1.2.
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<span>This article analysis regulation of legal relationship between shareholders in closely held company. Authors define “closely held companies” by functional approach, analyzing specific features which distinguish this type of companies from all other companies, regardless of their legal form. Available data suggests there are a significant number of these companies in Croatia and abroad. There are two basic corporate governance challenges in closely held company concerning the shareholders relations: potential abuse of its position by the majority shareholder, especially when majority shareholder acts as manager and the so-called “deadlock” when shareholders cannot reach agreement on any decision necessary for normal functioning of the company. Personal relations between the shareholders are in the core of these corporate governance issues. The Croatian private limited liability company is a model of closely held company in Croatia. Thus, this article analysis the withdrawal and exclusion of shareholders in Croatian court practice and its significance for solving the conflicts between shareholders in order to preserve the company. Authors advocate for more extensive use of the right to autonomously regulate the relationships between the shareholders in closely held companies. In that regard, authors suggest to use articles of association for more precise regulation of shareholders relationship, to set higher quorum when deciding important decisions in shareholders’ meeting which would empower the minority shareholders, to leave the important decisions on governing the company in the scope of the shareholders’ meeting and other. Also, authors consider that formation of supervisory body could contribute to achieve balance between the shareholders, especially between the majority and minority shareholders. Set of recommendations set in corporate governance codes could be of great use when drafting the articles of association. In that regard, authors call for de lege ferenda implementation of such a code, following the established practice on the comparative level</span>
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Hai, Lien Dang Phuoc. "A comparison of Japan and Vietnam legal approaches to derivative suit." Science & Technology Development Journal - Economics - Law and Management 4, no. 2 (June 21, 2020): First. http://dx.doi.org/10.32508/stdjelm.v4i2.626.
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Derivative suits are claims brought by a shareholder or a group of shareholders on behalf of the company to redress for wrongdoings of the directors when those in the company’s control refuse to assert a claim usually because of a conflict of interest. The derivative suit is not only to seek recovery of damages by a plaintiff shareholder but also serves as a further threatening tool that can be a possible deterrent to the neglect of duties by directors and other officers of the company [9]. In Vietnam, the derivative suit mechanism was first adopted by Vietnamese corporate law since Decree No. 102/2010/ND-CP (Decree 102) under the term “Shareholder’s right to sue members of the Board of Management and/or Director (General Director)”, rather than “derivative suit”. The regulatory framework for derivative suits has since been revised and contemplated under the latest Law on Enterprises of Vietnam, which was passed by the National Assembly in 2014. Under this scheme, a shareholder or a group of shareholders holding at least one percent (1%) of the total number of ordinary shares in a Joint Stock Company (JSC) for six consecutive months may bring a lawsuit on behalf of the company against the directors who breach their duties. Still, the practicability and usability of this derivative suit mechanism seem questionable because of a plethora of defects and shortcomings in the statutory derivative suit along with the lack of interest in litigation on the part of shareholders. This article undertakes the analytical review of the substance of the statutory derivative suit in Vietnam and Japan and from the comparison between the two systems, provides recommendations to improve the Vietnamese legislation.
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Cuervo García, Álvaro, and Luisa Reyes-Recio. "The substitution effect between managerial control mechanisms and its effect on the creation of value in reference to firm diversification." Corporate Ownership and Control 5, no. 1 (2007): 382–96. http://dx.doi.org/10.22495/cocv5i1c4p6.
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This paper aims to investigate the relationships between two governance mechanisms such as active shareholder control and the board of directors, as well as their effect on the creation of value for the shareholder, using firm diversification strategy as the moderating variable. These relationships indicate the existence of a substitution effect between both governance mechanisms, with a more inactive board in firms with large shareholders. On the other hand, the analysis of governance mechanisms and firm diversification strategy indicate the positive effect of shareholder concentration on the creation of value for shareholders in non-diversified firms and, the positive effect of the board of administration on the creation of value for shareholders in diversified firms
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Ma, Jiameng. "Determinants of Small Business Owner Loan." Journal of Finance Research 3, no. 2 (October 29, 2019): 8. http://dx.doi.org/10.26549/jfr.v3i2.2174.
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Shareholders and debtholders have diverging objectives. Shareholders are residual claimants whereas debtholders are fxed claimants to frm’s assets. In leveraged frms, shareholders may increase the value of their claims at the expense of debtholders. The presence of shareholders being debtholders is a smart interest alignment, providing a solution to shareholder-debtholder conflicts. This paper focuses on small businesses, which play an important role in the United States economy but are generally neglected by academia. Utilizing National Survey of Small Business Finance (NSSBF) data, this paper shows that frms with higher agency cost of debt are more likely to issue owner loan. The incidence of small business owner loan is positively associated with external lending diffculty, low shareholder agency cost and frm valuation diffculty.
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Ezzamel, Mahmoud, Jason Zezhong Xiao, and Rongli Yuan. "Can Small Shareholders Protect Their Interests from Expropriation: The Case of a Chinese Bank." Management and Organization Review 16, no. 1 (August 29, 2019): 139–68. http://dx.doi.org/10.1017/mor.2019.23.
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ABSTRACTThis article examines how small shareholders protected their interests from large shareholders’ expropriation by forming an alliance and taking collective action to block a convertible bonds issue by a Chinese bank that they considered harmful. Forming an alliance strengthened small shareholders’ network density, enhanced their salience (power, legitimacy, and urgency), and reduced the bank's centrality. This enabled small shareholders to change their strategy from being a subordinator to a compromiser and forced the controlling shareholders and their representatives to change their strategy from a commander to a compromiser. Apart from interest-based motives, the alliance provided small shareholders with identity-based incentives to persistently oppose expropriation by controlling shareholders. This article enriches the literature on small shareholder activism and principal-principal problem.
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Liu, Tingli, and Qianqian Shi. "Large shareholders' relationship, active shareholder and supervision." International Journal of Monetary Economics and Finance 8, no. 2 (2015): 191. http://dx.doi.org/10.1504/ijmef.2015.070782.
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