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Post by Sapphire Capital on Jul 26, 2008 20:59:59 GMT 4
Contractual Corporate Governance Marc Goergen University of Sheffield Management School; European Corporate Governance Institute (ECGI) Luc Renneboog Tilburg University - Department of Finance; European Corporate Governance Institute (ECGI) April 1, 2008 TILEC Discussion Paper No. 2008-015 CentER Discussion Paper Series No. 2008-41 Journal of Corporate Finance, July 2008 ECGI - Finance Working Paper No. 205/2008 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 firms 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). papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID1138022_code512461.pdf?abstractid=1123504&mirid=3
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