Showing papers by "Steen Thomsen published in 2004"

Corporate values and corporate governance

Abstract: There is growing interest in corporate values but where do they come from? What factors determine corporate values? This paper argues that they are determined by corporate governance in a broad sense of the word. Three governance mechanisms are emphasized: ownership structure, board composition and stakeholder influence. In smaller companies founder‐owners often play a pivotal role in shaping corporate value systems that influence companies for years to come. In larger companies that separate ownership and control, managers and boards come to play a powerful role. In both cases repeated interaction with customers, employees and other stakeholders shape corporate values by way of corporate reputation and corporate culture.

Foundation Ownership and Financial Performance: Do Companies Need Owners?

Abstract: A curious ownership structure is found in Northern Europe—foundations that own and operate business companies. The foundations are non-profit entities, they have no members and no owners, and they cannot be dissolved. In many cases, these entities control more than 50% of the votes in successful international companies. Obviously, this structure completely blocks the market for corporate control, but it also violates other basic principles of agency theory and corporate finance. Nevertheless, we present evidence that a sample of foundation-owned companies listed on the Copenhagen Stock Exchange are at least as efficient as other listed companies in terms of risk adjusted stock returns, accounting returns and Tobin’s Q. Thus, they question whether profit-seeking ownership is a necessary condition for competitive enterprise.