Controlling Shareholders: Issues and Challenges for Shareholders’ Empowerment in Directors’ Remuneration in Corporate Malaysia

2014 ◽  
Vol 9 (1) ◽  
Author(s):  
Shanthy Rachagan ◽  
Aiman Nariman Mohd Sulaiman
Keyword(s):  
Emerging Economies ◽  
Ownership Structure ◽  
Self Regulation ◽  
Developed Countries ◽  
Interesting Case ◽  
Minority Shareholders ◽  
Controlling Shareholders ◽  
Legal Rules ◽  
Current Reform

AbstractCurrent reform concerning directors’ remuneration relies on improving legal rules and self-regulation to minimise expropriation of minority shareholders. These have prominently focussed on empowering shareholders. Nonetheless, it is unclear as to the extent these reform proposals are compatible within the concentrated shareholding structure. Some of the reforms taking place in developed countries are suited for dispersed shareholding structure and thus transplanting them to emerging economies with concentrated shareholders may be ineffective. Malaysia poses an interesting case study, especially to countries with similar ownership structure as the concentrated shareholding structure raises different agency problems. The issue of protection of minority shareholder rights and the prevention of abuse of the controlling power by paying excessive remuneration to the executives is therefore a subject of due consideration in Malaysia and countries with similar shareholding structures. This article recommends that Malaysia and other emerging countries look into encouraging limited shareholder empowerment in tandem with laws.

Controlling Shareholders: Issues and Challenges for Shareholders’ Empowerment in Directors’ Remuneration in Corporate Malaysia

2014 ◽  
Vol 9 ◽  
pp. 267-294 ◽  
Author(s):  
Shanthy Rachagan ◽  
Aiman Nariman Mohd Sulaiman
Keyword(s):  
Emerging Economies ◽  
Ownership Structure ◽  
Self Regulation ◽  
Developed Countries ◽  
Interesting Case ◽  
Minority Shareholders ◽  
Controlling Shareholders ◽  
Legal Rules ◽  
Current Reform

AbstractCurrent reform concerning directors’ remuneration relies on improving legal rules and self-regulation to minimise expropriation of minority shareholders. These have prominently focussed on empowering shareholders. Nonetheless, it is unclear as to the extent these reform proposals are compatible within the concentrated shareholding structure. Some of the reforms taking place in developed countries are suited for dispersed shareholding structure and thus transplanting them to emerging economies with concentrated shareholders may be ineffective. Malaysia poses an interesting case study, especially to countries with similar ownership structure as the concentrated shareholding structure raises different agency problems. The issue of protection of minority shareholder rights and the prevention of abuse of the controlling power by paying excessive remuneration to the executives is therefore a subject of due consideration in Malaysia and countries with similar shareholding structures. This article recommends that Malaysia and other emerging countries look into encouraging limited shareholder empowerment in tandem with laws.

scholarly journals Innovation on Wheels in Emerging Economies: Lessons from Auto MNC’s Experience

2016 ◽  
Vol 11 (8) ◽  
pp. 44 ◽  
Author(s):  
Rifat Sharmelly
Keyword(s):  
Emerging Economies ◽  
Product Innovation ◽  
Developed Countries ◽  
Multinational Companies ◽  
Value For Money ◽  
Mass Market ◽  
Innovative Performance ◽  
The Creation ◽  
Acceptability Criteria

Emerging economies (EEs) are increasingly being considered as new sources of growth and innovation opportunities for global auto multinational companies. Many multinational companies from developed countries are eager to prosper in these economies. However, the crucial challenge that companies face today is to identify what precisely are the approaches required to serve mass market customers in EEs. In this research, the case study of a foreign auto multinational operating in India has been utilized. Focusing on the product innovation for the Indian masses with the creation of the most affordable car ‘Figo’ from the reputed auto multinational Ford, this analysis reveal the importance of engaging same set of suppliers in trust based, recurrent collaborative linkages to enhance the innovative performance. In addition, ensuring an effective value-for-money proposition is needed to achieve innovations with required affordability and acceptability criteria. Furthermore, experimenting with modules and resultant learning about markets are needed to enhance the innovative performance. With the suggested testable propositions, this study has significant theoretical contributions as well as implications for managers of aspiring companies intending to serve EEs.

scholarly journals Household Food Waste: A Case Study in Southern Italy

2020 ◽  
Vol 12 (4) ◽  
pp. 1495 ◽  
Author(s):  
Azzurra Annunziata ◽  
Massimiliano Agovino ◽  
Aniello Ferraro ◽  
Angela Mariani
Keyword(s):  
Food Waste ◽  
Southern Italy ◽  
Developed Countries ◽  
Interesting Case ◽  
Household Food ◽  
Italian Regions ◽  
Depth Analysis ◽  
Point Of Purchase ◽  
The Subject

To achieve the goal of reducing consumer-related food waste in developed countries, it is necessary to have an in-depth understanding of the factors shaping food waste, both in the household as well as at the point of purchase. Despite a growing number of studies on the subject, especially in recent years, the evidence on drivers of food waste and barriers to its reduction is somewhat conflicting. The current paper contributes to existing knowledge on food waste behaviour at the consumer level, providing original results from a direct survey conducted with a sample randomly selected in southern Italy to reveal consumer awareness, concerns and intentions towards food waste and to ascertain the existence of different consumer profiles with similar food waste behaviour. Since southern Italian regions have been shown to produce lower levels of food waste than regions in northern Italy, an in-depth analysis of the drivers behind food waste in this area could be considered an interesting case study. Our findings showed the existence of several consumer behaviour profiles that influenced household food waste generation. Strategies to reduce waste should take such differences into account in order to promote changes in food waste behaviour.

Dividend Policy with Controlling Shareholders

2015 ◽  
Vol 16 (1) ◽  
Author(s):  
Maribel Sáez ◽  
María Gutiérrez
Keyword(s):  
Empirical Evidence ◽  
Dividend Policy ◽  
Empirical Literature ◽  
Minority Shareholders ◽  
Dividend Payout ◽  
Controlling Shareholders ◽  
Legal Rules ◽  
Ownership Structures ◽  
Agency Conflict ◽  
Concentrated Ownership

AbstractThis Article investigates the determinants of dividend policy in firms with concentrated ownership structures. A review of the empirical literature shows that dividend payout ratios are lower in firms with controlling shareholders. We explain this finding as a consequence of the legal rules governing cash distributions, which leave the dividend decision in the hands of the firm insiders, and the lack of monitoring mechanisms for checking the power of controlling shareholders. The analysis of the empirical evidence on dividend policy points to the existence of an unresolved agency conflict between controlling shareholders and outside investors. We conclude that controlling shareholders are currently using the dividend policy to expropriate minority shareholders.

scholarly journals Torn between patriotic, civic and disciplinary aspirations. Evolving faces of Belgian and Flemish history education, from 1830 to the future

2018 ◽  
Author(s):  
Karel Van Nieuwenhuyse
Keyword(s):  
History Education ◽  
Analytical Framework ◽  
Interesting Case ◽  
School Subject ◽  
The Past ◽  
School History ◽  
Different Types ◽  
History Of ◽  
Current Reform

Torn between patriotic, civic and disciplinary aspirations. Evolving faces of Belgian and Flemish history education, from 1830 to the futureHistory education worldwide faces competing, rival visions and even contrasting expectations. Those expectations can be clustered in three main groups, each pursuing a different main goal for and a different approach towards studying the past: ‘nation-building and social cohesion’, ‘democratic participation and civic behavior’, and ‘disciplinary understanding’. This contribution examines how secondary school history education in Belgium (since its establishment in 1830) has been given shape, and how its main goals have evolved. Belgium (and later on Flanders) serves as an interesting case study, as the country testifies to a difficult, contested past, has evolved into a nation-state in decline, and is increasingly characterized by intercontinental immigration. Using the three clusters of rival expectations as an analytical framework, it is analyzed what the consecutive main goals for the school subject of history have been, which changes occurred throughout the past two centuries and why, and what have been the effects of these different types of history education on young people. The analysis allows to discern three main stages in the history of history education in Belgium/Flanders. For all three, the main goals are explained, and their effects examined. This contribution concludes with critically discussing the different aims, and, while reporting on the current reform of the school subject of history in Flanders, setting a fourth aim to the fore. Rozziew pomiędzy aspiracjami patriotycznymi, obywatelskimi i zrozumieniem dyscypliny. Ewolucja oblicza nauczania historii w szkołach Belgii i Flandrii od 1830 roku i jego przyszłośćNa całym świecie nauczanie historii napotyka konkurujące i rywalizujące ze sobą wyobrażenia, a nawet rodzi sprzeczne oczekiwania. Oczekiwania owe można ująć w trzy kompleksy zasadniczych zagadnień, przy czym każdy z nich ma inny główny cel studiowania przeszłości i inaczej do niego podchodzi; są to: „budowanie narodu i spójność społeczna”, „demokratyczna partycypacja i postawy obywatelskie” oraz „rozumienie dyscypliny”. Artykuł omawia, w jaki sposób kształtowało się nauczanie historii w szkołach średnich w Belgii (od jej powstania w 1830 roku) i jak ewoluowały jego główne cele. Belgia (a później Flandria) służy jako interesujący przypadek badawczy, gdyż kraj ten doświadczył trudnej, kontestowanej przeszłości, stał się państwem jednonarodowym w upadku i coraz bardziej właściwa mu jest międzykontynentalna imigracja. Wykorzystując wspomniane wyżej trzy kompleksy złożonych oczekiwań jako analityczne ramy badawcze, autor analizuje najistotniejsze zadania, które stoją przed przedmiotem szkolnym historia, następnie omawia zmiany, które zaszły w tym zakresie w minionych dwóch stuleciach i wyjaśnia ich przyczyny, a wreszcie docieka, jaki wpływ odmienne rodzaje nauczania historii wywarły na młodych ludzi. Analiza pozwala wyróżnić trzy zasadnicze etapy w dziejach nauczania historii w Belgii / Flandrii. Autor objaśnia, jakie główne cele stały przed wszystkimi trzema grupami i jakie przyniosły efekty. Artykuł zamyka krytyczna ocena omawianych celów oraz przedstawienie aktualnie mającej miejsce reformy przedmiotu szkolnego historia we Flandrii, a na końcu wskazanie czwartego celu: edukacji na przyszłość. [Trans. by Jacek Serwański]

scholarly journals Ownership structure and corporate governance code: The case of family business enterprises in Germany

2009 ◽  
Vol 6 (4) ◽  
pp. 382-390 ◽  
Author(s):  
Marion Weissenberger-Eibl ◽  
Patrick Spieth
Keyword(s):  
Corporate Governance ◽  
Family Business ◽  
Ownership Structure ◽  
Family Businesses ◽  
Minority Shareholders ◽  
Controlling Shareholders ◽  
Corporate Governance Code ◽  
Business Enterprises ◽  
And Control

Ownership of corporations in Germany is today highly concentrated in the hands of families and other companies. Theses ‘insider’ systems often result in core conflict tends to be between controlling shareholders and sometimes between strong stakeholders and weak minority shareholders. The aim of this paper is to research the characteristics of ownership and control in family business and point out the role of Family Business Governance in securing an appropriate control of the owning families. The authors give suggestions how to implement the German Governance Code recommendations in family businesses.

scholarly journals Effects of ownership structure on the mergers and acquisitions decisions in Brazilian firms

2019 ◽  
Vol 55 (2) ◽  
pp. 227-245
Author(s):  
Nasaré Vieira Nogueira ◽  
Luiz Ricardo Kabbach de Castro
Keyword(s):  
Ownership Structure ◽  
Conflicts Of Interest ◽  
Ownership Concentration ◽  
Minority Shareholders ◽  
Controlling Shareholder ◽  
Content Type ◽  
Controlling Shareholders ◽  
Future Studies ◽  
Shareholder Protection ◽  
Use Of Resources

Purpose The purpose of this study is to examine the effects of ownership structure on merger and acquisition (M&A) decisions of Brazilian listed companies. Design/methodology/approach This paper is an applied and explanatory research based on secondary data. The sample is comprises non-financial companies listed on the BM&FBovespa between 1998 and 2007. Considering that the dependent variable is binary, the authors estimate panel data logistic regression models. Considering the existence of conflicts of interest among those who have the decision-making power and the supplier of capital for M&A transactions, they draw upon the Agency Theory to develop the theoretical hypotheses. Findings The results show that, for a sample of Brazilian non-financial companies listed on the BM&FBovespa (B3), from 1998 to 2007, Brazilian firms present, on average, a highly concentrated ownership structure and the major controlling shareholders are families or the State. These characteristics are negatively related to the likelihood of M&A transactions, as most of these controlling shareholders are reluctant to adopt mechanisms that reduce their control. Research limitations/implications With regard to the limitations, this study considered only the M&A definitions as stated by the Bureau van Dijk database. In this sense, future studies may analyze the effects of ownership structure based on other M&A definitions and typologies. In addition, the study is limited to the period from 1998 to 2007, which is prior to the international financial crisis. Future studies may extend the analysis period to include the post-crisis period (2008) to check if there are differences in M&A strategies before and after the crisis. Practical implications From a managerial perspective, the results show that minority shareholders have little or no influence over an M&A decision, so they cannot decide on the use of resources for fast growth and access to new markets through M&A. Thus, the investment decision must take into account the nature and the quality of the controlling shareholder. Social implications This study shows a significant and negative effect of ownership concentration on the likelihood of M&A transactions. In part, this result demonstrates the importance of understanding the behavior of controlling shareholders before inferring on other key aspects that the M&A literature tends to make fundamental in explaining M&A decisions in publicly traded companies, particularly, in an environment of low minority shareholder protection. Originality/value Previous studies have partly found that the M&A decision is motivated by individual advantages obtained from increasing the size of the firm, or from managerial hubris. The results show that these hypotheses do not hold in the Brazilian context. Moreover, the results indicate that M&A decisions are associated with the characteristics of the controlling shareholder, their level of ownership concentration and their typology, contributing to the agency debate on whether the incentive or the entrenchment effect prevails in the context of the agency problem between controlling and minority shareholders, particularly, in an institutional environment of low shareholder protection.

scholarly journals Ownership Structure, Corporate Governance, and Firm Value: Evidence from Ghana

2019 ◽  
Vol 4 (6) ◽  
Author(s):  
Kong Yusheng ◽  
Samuel Asubonteng ◽  
Alex Antei-Adje
Keyword(s):  
Corporate Governance ◽  
Stock Returns ◽  
Cash Flow ◽  
Ownership Structure ◽  
Firm Value ◽  
Minority Shareholders ◽  
Control Rights ◽  
Controlling Shareholders ◽  
Percentage Points ◽  
Investment Opportunities

We use a sample of 100 firms in Ghana to study the effect of ownership structure on value during the region's financial crisis. The crisis negatively impacted firms' investment opportunities, raising the incentives of controlling shareholders to expropriate minority investors. Crisis period stock returns of firms in which managers have high levels of control rights, but have separated their control and cash flow ownership, are 10-20 percentage points lower than those of other firms. The evidence is consistent with the view that ownership structure plays an important role in determining whether insiders expropriate minority shareholders.

scholarly journals Reasons for and implications of the presence of institutional investors in the ownership structure of Brazilian companies

2016 ◽  
Vol 13 (4) ◽  
pp. 598-608 ◽  
Author(s):  
Lélis Pedro de Andrade ◽  
Aureliano Angel Bressan ◽  
Robert Aldo Iquiapaza ◽  
Wesley Mendes-Da-Silva
Keyword(s):  
Agency Theory ◽  
Chief Executive Officer ◽  
Ownership Structure ◽  
Institutional Investors ◽  
Chief Executive ◽  
Agency Conflicts ◽  
Minority Shareholders ◽  
Controlling Shareholders ◽  
Agency Conflict ◽  
Equity Funding

Using 3,057 observations from 2000 to 2012, we found the risk of expropriation of minority shareholders by controlling shareholders is positively associated with participation of institutional investors in equity funding. There is no evidence that these investors increase the likelihood of substituting the chief executive officer or increase the company’s value or its financial performance. However, the presence of institutional investors is associated with higher company debt. This study suggests that institutional investors assume a function not fully explained by agency theory, such as enabling greater access to debt markets, but accentuate the agency conflict between controlling and minority shareholders. The main results show that the presence of institutional investors mitigates agency conflicts between shareholders and creditors, but increases the risk of expropriation of minority shareholders.

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