Most listed firms have concentrated ownership structures. However this ownership type is problematic. A clinical analysis reveals that the corporate governance in these firms in terms of liability, voice and exit faces important design problems.
Our analysis shows that the corporate governance of these firms is mainly aimed at checking the shareholders-manager agency problem leaving the controlling shareholder-minority agency problem unresolved. Therefore it is crucial to provide growing companies with commitment tools that allow them to access capital markets and to raise funds from outside investors in better terms without having to give up the benefits of control. This leads us to a proposal that could improve the protection of outside investors while maintaining the informational benefits of concentrated ownership structures: a ?Say-on-Dividend? policy. This proposal is centered in empowering independent directors and activist and institutional investors in the design of dividend policy as informed intermediaries that can represent the voice of the outside investors in the control of the funds that they invest in the firm.
Dual-class voting systems have been widely employed in recent initial public offerings by large tech companies, but have been roundly condemned by institutional investors and the S&P 500. As an alternative, commentators have proposed adoption...Read more
We consider institutional voting on Say-On-Pay as a function of the size of an institution’s position. Smaller positions, measured either as percent of a firm held or portfolio weight invested in a firm, lead to lower support of management in SOP...Read more
We study reward crowdfunding, the most innovative segment of the crowdfunding market, where, instead of a debt or equity contract, fund providers are promised some good or service in the future in exchange for their contribution to the funding...Read more
We find that potential conflicts between majority and minority shareholders strongly influence how dividends respond to taxes. Examining the population of firms with proprietary microdata on all family relationships and a million individual tax...Read more