The German Supervisory Board on its Way to Professionalism

2010 ◽  
Vol 11 (2) ◽  
pp. 115-158 ◽  
Author(s):  
Jan Lieder
Keyword(s):  
Corporate Governance ◽  
Internal Control ◽  
Supervisory Board ◽  
Decision Making Process ◽  
European Level ◽  
Governance System ◽  
Management Board ◽  
Corporate Governance System ◽  
Flow Of Information ◽  
Board System

The paper shows how the efficiency of the German supervisory board has been significantly improved in the last decade. These legal changes made the supervisory board climb to a higher position of power. In particular, the supervisory board is now significantly involved in the decision-making process on a company's overall strategic concept and on management decisions of fundamental importance. This emphasizes the future-oriented monitoring obligation of the supervisory board, which gained much more importance in the last decade. Furthermore, the new provisions increased the flow of information from the management board to the supervisory board, and they facilitated the monitoring efficiency of every single supervisory board member. In addition, several important changes improved the cooperation of supervisory board and auditors. The most recent changes strengthened the supervisory board's responsibility with regard to internal control and risk management.The vest majority of those changes in the German supervisory board system are very welcome. However, the current regime of German codetermination as well as the excessive size of the supervisory board has to be changed. Under the important developments on the European level, the time has come to act now in this direction. The advocated concept of codetermination by consensus provides a solid basis for more flexibility in the rigid German corporate governance system. It is also desirable to further limit the size of the supervisory board to no more than twelve members. Finally, the efficiency of the corporate governance system would be improved by allowing enterprises to choose between a one-tier and a two-tier board system.

scholarly journals The two-tier board system and underpricing of initial public offerings: Evidence from Austria

2014 ◽  
Vol 12 (1) ◽  
pp. 352-362
Author(s):  
Lalith P. Samarakoon ◽  
Palani-Rajan Kadapakkam
Keyword(s):  
Corporate Governance ◽  
Agency Theory ◽  
Initial Public Offerings ◽  
Stock Exchange ◽  
Supervisory Board ◽  
Board Structure ◽  
Ipo Underpricing ◽  
Public Offerings ◽  
Management Board ◽  
Board System

We study the relation between initial IPO underpricing and two-tier board structure in the Vienna Stock Exchange of Austria, where a two-tier board is mandatory for listed companies. The board ratio, defined as the size of the supervisory board to the management board, is used to capture the effect of two-tiered board on underpricing. The results show that the board ratio is negatively related with underpricing, consistent with the agency theory which predicts that more effective monitoring implied in a relatively larger supervisory board will lead to lower agency costs, and thus lower underpricing. The results are robust to the inclusion of control variables and suggest that firms seeking to raise external capital will be helped by adopting strong corporate governance standards.

scholarly journals Between controlled co-option and direct election

2005 ◽  
Vol 1 (1) ◽  
pp. 38-50
Author(s):  
Rienk Goodijk
Keyword(s):  
Corporate Governance ◽  
Research Method ◽  
Supervisory Board ◽  
Key Factors ◽  
Governance System ◽  
Direct Election ◽  
Corporate Governance System ◽  
Recent Developments ◽  
Option Model ◽  
Pros And Cons

This paper first describes the complex Dutch corporate governance system and the functioning of the Supervisory Board under the rules of the structure regime and co-option model up to the present time. The critiques of the parties and stakeholders involved in this model are investigated next, followed by a description and explanation of the recent developments of the Dutch model and a discussion of the pros and cons of the alternatives with regard to the interests of the various stakeholders. Finally, some key factors for improving the boards’ functioning in the – changing – Dutch corporate governance system are presented. The findings and recommendations are based on case-studies and interviews conducted in large Dutch companies over several years and on extensive analyses of documents and recent evolutions. This research method however, is only suitable for a process of exploration, clarification and development of hypotheses.

scholarly journals Did culture have an impact on Tunisian corporate governance system

2008 ◽  
Vol 5 (3) ◽  
pp. 471-481
Author(s):  
Fatma Wyeme Ben Mrad Douagi ◽  
Rim Boussaada
Keyword(s):  
Corporate Governance ◽  
Financial Market ◽  
Cultural Dimensions ◽  
Ownership Concentration ◽  
Hostile Takeover ◽  
Governance System ◽  
Corporate Governance System ◽  
Cultural Component ◽  
The Impact ◽  
Board System

Numerous research works on corporate governance have been undertaken while only few attentions have been devoted to the study of cultural component. The aim of this research is precisely to contribute to the necessary renewal of corporate governance by attempting to highlight some crucial features and issues related to the impact of culture on Tunisian corporate governance system. Based on cultural dimensions of Hofstede (1980), we try to identify the impact of culture on Tunisian corporate governance system. We argue that the characteristics of Tunisian corporate governance system such as ownership concentration, inactivity of hostile takeover market, one–tier board system, limited transparency of information and underdevelopment of financial market, reflect the Tunisian culture

scholarly journals Management in the corporate governance system

2018 ◽  
pp. 7-20
Author(s):  
Mykhailo Shkilniak
Keyword(s):  
Corporate Governance ◽  
Supervisory Board ◽  
General Meeting ◽  
Well Being ◽  
Effective Control ◽  
Business Organization ◽  
Governance System ◽  
Corporate Governance System ◽  
Market Relations ◽  
And Control

The article points out that the process of introducing market relations in Ukraine and the growing role and importance of joint-stock companies in the economic development of the country and well-being of its citizens have created the need of corporate governance that emerged due to changing ownership structures and transition to market relations. The study shows that the corporate form of business organization is a new and complex phenomenon in Ukraine. Corporations (joint-stock companies) are the most widespread and significant form of business organization in the current conditions. It is emphasized that the defining feature of a corporation is that it is owned by shareholders who bought stock. This requires a completely different approach to management and control. The nature, role and principles of corporate governance framework are described. It is reasoned that since management and ownership are separated, there is a need to balance interests of shareholders and management. It is stressed that corporate governance is an important factor in the company’s activity and development, the primary purpose of which is to provide owners with the opportunity to organize and exercise effective control over management. The essence of corporate governance is to achieve a balance of interests for participants of corporate governance, namely: shareholders, managers, supervisory board and other groups and individuals (suppliers, consumers, creditors, government authorities, etc). The role and place of management in corporate governance, their interests and powers are highlighted. The following responsibilities are associated with executive bodies, or management: solving currents problems related to the corporation’s activities, ensuring decision-making by general meeting of shareholders and supervisory board, planning, organizing, motivating, coordinating, and monitoring. It is substantiated that management and corporate governance are different concepts. The key difference is that corporate governance is a wider concept, and management is an integral part of it. The effectiveness of corporate governance rests on the organization of the work of management.

scholarly journals Nurturing Corporate Governance System: The Emerging Trends in Nigeria

2009 ◽  
Vol 4 (2) ◽  
Author(s):  
Benjamin James Inyang
Keyword(s):  
Corporate Governance ◽  
Internal Control ◽  
Governance Structure ◽  
Securities And Exchange Commission ◽  
Control Mechanisms ◽  
Governance System ◽  
Corporate Governance Structure ◽  
Public Corporations ◽  
Emerging Trends ◽  
Corporate Governance System

The paper traced the nascent history of corporate governance system in Nigeria and noted the paucity of literature in the subject. Mainstream issues of corporate governance in the country emerged with the enactment of the Companies and Allied Matters Act of 1990 (CAMA 1990), which established the Corporate Affairs Commission (CAC), and charged it with the responsibility of overseeing the regulation and supervision of the formation, incorporation, registration, management and winding up of companies. The corporate governance codes of both the Securities and Exchange Commission (SEC) and the Central Bank of Nigeria (CBN), gave impetus for the development of corporate governance structure, to ensure transparency, accountability, probity, integrity and fairness in the management and control of the public corporations, and thereby creating value for the shareholders and stakeholders. Major challenges which required urgent attention to enhance the effectiveness of the system were noted thus: making the voluntary codes mandatory; developing more effective mechanisms for monitoring compliance and enforcement; developing strong internal control mechanisms to checkmate the boards oversight responsibility; crafting strategies to enhance shareholders activism and the extension of the codes to state-owned enterprises with more cases of corporate governance abuses.

scholarly journals The Critical Analysis of Some Comparative Eastern Africa Corporate Governance Standards After Financial Crisis, Corporate Scandals and Manipulation

2021 ◽  
Vol 1 (1) ◽  
pp. 54-63
Author(s):  
Dinh Tran Ngoc Huy
Keyword(s):  
Corporate Governance ◽  
Internal Control ◽  
Eastern Africa ◽  
Governance System ◽  
Corporate Scandals ◽  
Corporate Governance System ◽  
Policy Suggestions ◽  
Internal Control System ◽  
Group 2 ◽  
Group 1

Even though corporate scandals and bankruptcy in US and Europe and Asia show some certain evidence on weak corporate governance, weak internal control system and weak audit, Global corporate governance forum noted corporate governance has become an issue of worldwide importance. Therefore, this paper chooses a different analytical approach and among its aims is to give some systematic opinions.First, it classifies Eastern Africa representative corporate governance (CG) standards into two (2) groups: Malawi and Kenya latest CG principles covered in group 1 and, group 2, including corporate governance guidelines from EVCA 2005, so-called relative good CGgroup, while it uses ACCA and CFA principles as reference. Second, it , through analysis, shows differences between above set of standards which are and have been used as reference principles for many relevant organizations. Third, it establishes a selected comparative set of standards for Eastern Africa representative corporate governance system in accordance to international standards.Last but not least, this paper covers some ideas and policy suggestions.

scholarly journals COMPLIANCE AS A TOOL OF COMPANY VALUE IMPROVEMENT

2016 ◽  
Vol 4 (4) ◽  
pp. 461-464
Author(s):  
Михаил Алёшин ◽  
Mikhail Aleshin ◽  
Елена Алёшина ◽  
Elena Aleshina
Keyword(s):  
Sustainable Development ◽  
Corporate Governance ◽  
Internal Control ◽  
Developed Countries ◽  
Minimum Level ◽  
Governance System ◽  
Company Value ◽  
New Instrument ◽  
Corporate Governance System ◽  
Integral Element

The article highlights the problem of increasing the value of the corporation using the new instrument of corporate governance - compliance, which is widely used in economically developed countries. There has been a lack of theoretical elaboration of compliance. Based on the existing experience of applying compliance, the article examines two main approaches: the minimum level of organization compliance and compliance culture. The article gives advantages that acquire the corporation using the compliance function, and possible implications for corporations that do not adopt compliance. It is concluded that the compliance system is a competitive advantage of the corporation, each year its value as a function of internal control and an integral element of the corporate governance system will grow that will ensure the conservation and sustainable development of the Corporation through the growth of its value.

scholarly journals Corporate Governance and ERM for SMEs Viability in Italy

2021 ◽  
Author(s):  
Patrizia Riva ◽  
Maurizio Comoli ◽  
Ambra Garelli
Keyword(s):  
Corporate Governance ◽  
Early Warning ◽  
Supervisory Board ◽  
Governance System ◽  
Independent Control ◽  
Risk Monitoring ◽  
Corporate Governance System ◽  
Ex Ante ◽  
Family Smes ◽  
Accounting Control

Family Small and Medium-sized Enterprises (Family SMEs) in Italy have been asked by the new Insolvency and Crisis Code (IC-Code) to establish organizational, management and accounting bodies and tools appropriate to their nature and size. They need to be able to face early warning of company’s crisis and potential loss of going concern and to be able to implement strategies provided by the law to recover viability. The peculiarity of the Italian System is the joint existence of two levels of controls. A “downstream” one carried out by Auditors in charge of the accounting control and an “upstream” one carried out by the Supervisory Board in charge for the surveillance of directors’ behaviour. The board of statutory auditors (Collegio Sindacale), which has been defined as the watchdog distinguishing Italian corporate governance system, plays a fundamental role in reaching the goal. Its supervisory activities are played ex-ante over directors and are set with independence and competence. Auditors, instead, operate when everything has already been decided or even implemented concentrating on the accounting issues. The IC-Code sets up new corporate governance rules for a huge number of Family SMEs requiring the appointment of independent control bodies, Board of Statutory Auditors and Auditors and demanding therefore for more attention to risk monitoring and managing.

Zur Notwendigkeit des Vorstandsvergütungsoffenlegungsgesetzes

2007 ◽  
Vol 56 (2) ◽  
Author(s):  
Georg Stadtmann ◽  
Markus F. Wismann
Keyword(s):  
Corporate Governance ◽  
Central Element ◽  
Governance System ◽  
Management Board ◽  
Corporate Governance Code ◽  
Corporate Governance System ◽  
Compensation Level

AbstractDue to changes in the German Corporate Governance Code the transparency of compensation of the members of the management board has become a central element of the German corporate governance system. We analyze how the new transparency will influence the average compensation level. It can not be ruled out that average compensation levels will increase. By applying the so called unraveling theory we are able to show that a law was not necessary and a trend to a higher degree of transparency was on its way anyway.

scholarly journals КОРПОРАТИВНАЯ СИСТЕМА УПРАВЛЕНИЯ АКЦИОНЕРНЫМИ ОБЩЕСТВАМИ В РЕСПУБЛИКЕ БЕЛАРУСЬ

2018 ◽  
pp. 19-22
Author(s):  
И. Н. Рабыко
Keyword(s):  
Corporate Governance ◽  
Management System ◽  
Supervisory Board ◽  
Independent Directors ◽  
Corporate Management ◽  
Financial Risks ◽  
Governance System ◽  
Corporate Governance System ◽  
The Republic ◽  
Corporate Management System

Formulation of the problem. The development of the economy of the Republic of Belarus actualizes the improvement of corporate governance in joint-stock companies, since the largest enterprises of the republic are joint-stock companies. The subject of the research is to assess the current state of the corporate management system of joint-stock companies. The aim of the research is to reflect the role of the corporate management system of joint-stock companies in the Republic of Belarus as a tool for minimizing financial risks. The object of research is the development processes of the corporate management system of joint-stock companies of the Republic of Belarus. The methods used of the research are logical, comparative, analytical, scientific and methodological. The hypothesis of the study is the assumption of the dependence of the quality of the corporate management system of joint-stock companies and their financial risks. The statement of basic materials. An analysis of the world experience of the corporate governance system of joint stock companies shows that the number of independent directors ranges from 15 to 50% of the members of the board of directors (supervisory board) of the joint stock company. These are primarily requirements for issuers of securities, their corporate management system. Originality and practical significance of the research. Banks have obliged to include in the supervisory board at least two independent directors, making high demands on them. They should confirm their business reputation by certification in the National Bank of the Republic of Belarus. Conclusions of the research. The stages of creating a corporate governance system for joint-stock companies confirm the existence of a sufficient regulatory framework and best practices for creating effective corporate governance systems that allow you to manage risks, especially financial ones, and attract international investors.

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