Contractual corporate governance

Goergen, Marc ORCID: https://orcid.org/0000-0003-4391-2651 and Renneboog, Luc 2008. Contractual corporate governance. Journal of Corporate Finance 14 (3) , pp. 166-182. 10.1016/j.jcorpfin.2008.04.003

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Abstract

Companies have the choice to deviate from their national corporate governance standards by opting into another system. They can do so via contractual devices – such as cross-border mergers and acquisitions, (re)incorporations, and cross-listings – which enable them to choose their preferred level of investor protection and regulation. This paper reviews these three main contractual governance devices, their effect on value, and whether their adoption by firms induces a race to the bottom or a race to the top. Indeed, firms may opt for less shareholder-orientation or investor protection (shareholder-expropriation hypothesis) rather than for more stringent rules that require firms to focus on shareholder value (bonding hypothesis).

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Subjects:	H Social Sciences > H Social Sciences (General) H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management H Social Sciences > HF Commerce H Social Sciences > HG Finance
Uncontrolled Keywords:	Contractual corporate governance ; Corporate governance regulation ; Cross-border mergers and acquisitions ; Cross-listings ; Reincorporations ; Shareholder protection ; Creditor protection ; Spillover effects
Additional Information:	Special Issue: Contractual Corporate Governance European Corporate Governance Institute (ECGI) Symposium on Contractual Corporate Governance
Publisher:	Elsevier
ISSN:	0929-1199
Last Modified:	19 Oct 2022 09:56
URI:	https://orca.cardiff.ac.uk/id/eprint/22690

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