Corporate governance

About: Corporate governance is a research topic. Over the lifetime, 118591 publications have been published within this topic receiving 2793582 citations.

Enjoying the Quiet Life? Corporate Governance and Managerial Preferences

Abstract: Much of our understanding of corporations builds on the idea that managers, when they are not closely monitored, will pursue goals that are not in shareholders’ interests. But what goals would managers pursue? This paper uses variation in corporate governance generated by state adoption of antitakeover laws to empirically map out managerial preferences. We use plant‐level data and exploit a unique feature of corporate law that allows us to deal with possible biases associated with the timing of the laws. We find that when managers are insulated from takeovers, worker wages (especially those of white‐collar workers) rise. The destruction of old plants falls, but the creation of new plants also falls. Finally, overall productivity and profitability decline in response to these laws. Our results suggest that active empire building may not be the norm and that managers may instead prefer to enjoy the quiet life.

Governance as theory: five propositions

Abstract: Science in the Department of Government, University of Strathclyde, Glasgow, G1 1XQ, UK, email: G.stokerK strathclyde.ac.uk His main research interests are in local government, urban politics, and cross-national policy transfer. Between 1992 and 1997 he was Director of the ESRC Local Governance Research Programme. He has authored or edited over a dozen books. His two most recent publications are: Rethinking Local Democracy, 1996 (edited with D. King) and The Privatisation of Urban Services in Europe, 1997 (edited with D. Lorrain). Governance as theory: five propositions

Corporate Social Responsibility and Firm Financial Performance

Abstract: Using Fortune magazine's ratings of corporate reputations, we analyzed the relationships between perceptions of firms’ corporate social responsibility and measures of their financial performance. Results show that a firm's prior performance, assessed by both stock-market returns and accounting-based measures, is more closely related to corporate social responsibility than is subsequent performance. Results also show that measures of risk are more closely associated with social responsibility than previous studies have suggested.

Law, Finance, and Economic Growth in China

Abstract: China is an important counterexample to the findings in the law, institutions, finance, and growth literature: neither its legal nor financial system is well developed by existing standards, yet it has one of the fastest growing economies. We examine 3 sectors of the economy: the State Sector (state-owned firms), the Listed Sector (publicly listed firms), and the Private Sector (all other firms with various types of private and local government ownership). The law-finance-growth nexus established by existing literature applies to the State and Listed Sectors: with poor legal protections of minority and outside investors, external markets are weak, and the growth of these firms is slow or negative. However, with arguably poorer applicable legal and financial mechanisms, the Private Sector grows much faster than the State and Listed Sectors, and provides most of the economy's growth. This suggests that there exist effective alternative financing channels and governance mechanisms, such as those based on reputation and relationships, to support this growth.