Document: Une présentation powerpoint en anglais sur le concept de Corporate Governance et des problématiques tournant autour de sujet avec de solides références académiques, utiles pour approfondir ces connaissances.
1. Definition & Origin of the concept
2. Managerial Discretion & Subsequent Potential Abuses ? Causes &Typology
3. Managerial Incentive & Drawbacks
4. ?Shareholding? vs. ?Stakeholding?
5. Corporate Social Responsibility
6. ?Stakeholding? drawbacks
Sommaire du cours
Extraits du cours
[...] Corporate Governance - The roots of the concept Fundamental book for the corporate finance & corporate governance 1932: ?Modern Corporation and Private Property? from Gardiner C. Meals & Adolf A. Berle Quote: property owner who invests in a modern corporation so far surrenders his wealth to those in control of the corporation that he has exchanged the position of independent owner for one in which he may become merely recipient of the wages of capital . [...]
[...] ?Stakeholding? From a purely economic standpoint, according to the principle that prices reflect the scarcity of resources, management should strive to maximize shareholder value Founding principle for ?Shareholding? Corporate Finance, Managerial Incentives designed to maximize shareholder wealth On the other hand, this effort is not without externalities for the society and the company should thus internalize them Founding principle for Corporate Social Responsibility A widespread opinion is that ?stakeholding? & corporate social responsibility are only some additional marketing arguments Corporate Social Responsibility Corporate Social Responsibility involves: Duties toward employees Not laying off workers when the company performs well Protection of minorities Training possibilities Warranty of safe work place & facilities Duties toward communities Reduce environmental negative externalities Refrain to close plants in distressed economic areas Duties toward creditors Not maximizing shareholder value at the expense of creditors value Ethical considerations Environmental protection Refrain to employ subcontractors in developing countries with questionable employment policy Tax evasion ?Stakeholding? drawbacks Really difficult to implement Always more shareholders surrender their voting rights in favor to additional liquidity & to passive management preferences Granting control rights to non-investors may discourage financing Not enough ?pledgeable? as pay back Conflicting objectives between investors & natural stakeholders potentially dangerous & inefficient for the decision making process Difficulty to hold managerial accountability What can't be measured can't be measured Especially true when it comes to appraise responsible missions & results Conclusion The corporate governance concept is inseparable of two major & highly controversial field of research in economics: Agency theory The ?Shareholding? vs. ?Stakeholding? (insolvable) issue The shareholder-value approach is integral part of the classical economics thinking while the stakeholder society has a lot of room to further research & economics However, the corporate governance concept should also be considered as an effective tool of leadership & not essentially through the vantage point ?shareholding? vs. [...]
[...] Corporate Governance Problematic around this concept Agenda Definition & Origin of the concept Managerial Discretion & Subsequent Potential Abuses Causes &Typology Managerial Incentive & Drawbacks ?Shareholding? vs. ?Stakeholding? Corporate Social Responsibility ?Stakeholding? drawbacks Conclusion Bibliography Corporate Governance - Definition Definition according to the OECD: Procedures and processes according to which an organisation is directed and controlled. The corporate governance structure specifies the distribution of rights and responsibilities among the different participants in the organisation such as the board, managers, shareholders and other stakeholders and lays down the rules and proce-dures for decision-making. [...]