scholarly journals Positive or negative voting premium: What happened to private benefits in Italy?

2018 ◽  
Vol 15 (3) ◽  
pp. 92-100 ◽  
Author(s):  
Giuseppe Sancetta ◽  
Nicola Cucari ◽  
Salvatore Esposito De Falco
Keyword(s):  
Corporate Governance ◽  
Large Body ◽  
Voting Rights ◽  
Current Status ◽  
Private Benefits ◽  
Private Benefit ◽  
Private Benefits Of Control ◽  
The Future ◽  
Voting Premium ◽  
Almost All

A large body of research deals with voting premium as a proxy of private benefit of control. Almost all of them find positive voting premium, in particular in Italy. Therefore appears interesting to ask what is the current status of private benefits of control in Italy in the last decade (2007-2017). Surprisingly, we show three major findings: i) reduction of non-voting share in the Italian scenario; ii) prevalence of negative voting rights premium more than positive ones, thus conflicting with the assumption and the observations by other researchers; iii) limits of the voting premium method. Our aim is that this study, despite its limitations, may encourage further researches focused on the analysis of the improvement and the change in the Italian corporate governance. The article points out that interesting evidence already exists, although still much remains to do in the future.

scholarly journals Corporate Governance and Innovation: Theory and Evidence

2014 ◽  
Vol 49 (4) ◽  
pp. 957-1003 ◽  
Author(s):  
Haresh Sapra ◽  
Ajay Subramanian ◽  
Krishnamurthy V. Subramanian
Keyword(s):  
Corporate Governance ◽  
Corporate Control ◽  
Empirical Support ◽  
Innovation Theory ◽  
Private Benefits ◽  
Private Benefits Of Control ◽  
Market For Corporate Control ◽  
Ex Post ◽  
Corporate Governance Mechanisms ◽  
Ex Ante

AbstractWe develop a theory to show how external and internal corporate governance mechanisms affect innovation. We predict a U-shaped relation between innovation and external takeover pressure, which arises from the interaction between expected takeover premia and private benefits of control. Using ex ante and ex post innovation measures, we find strong empirical support for the predicted relation. We exploit the variation in takeover pressure created by the passage of antitakeover laws across different states. Innovation is fostered either by an unhindered market for corporate control or by antitakeover laws that are severe enough to effectively deter takeovers.

The ultimate controlling owner and corporate governance in Brazil

2019 ◽  
Vol 19 (1) ◽  
pp. 120-140 ◽  
Author(s):  
Vicente Lima Crisóstomo ◽  
Isac de Freitas Brandão
Keyword(s):  
Corporate Governance ◽  
Emerging Market ◽  
Governance System ◽  
Private Benefits ◽  
Controlling Shareholder ◽  
Content Type ◽  
Controlling Shareholders ◽  
Private Benefits Of Control ◽  
Corporate Governance System

Purpose High ownership concentration makes controlling blockholders powerful enough to use private benefits of control and able to shape the corporate governance system to favor their own interests. This paper aims to examine the effect of the nature of the ultimate firm owner on the quality of corporate governance in Brazil. Design/methodology/approach Econometric models are estimated to assess whether the nature of the ultimate controlling shareholder affects the quality of the corporate governance system. Models are estimated using panel data methodology with coefficients estimated by the generalized method of moments system estimator. Findings The results show that the absence of a controlling shareholder has a positive effect on corporate governance, whereas the presence of a controlling blockholder, or a shareholder agreement among a few large shareholders, has a negative effect. This adverse effect holds when the controlling blockholder is a family or another firm. The findings are in line with the expropriation effect given that weaker corporate governance system facilitates controlling shareholders’ ability to extract private benefits of control. The findings also give support to the substitution effect as powerful blockholders take on the management monitoring function by weakening the board. Originality value Following important previous literature, the study investigates the effect of the nature of large controlling shareholders on the adoption of good corporate governance practices. The work provides additional evidence on the effect of the nature of large controlling shareholders on the quality of the corporate governance system in Brazil, taking into account the main kinds of controlling blockholders present in that market. The findings give support to both the expropriation and substitution hypotheses highlighting the presence of the principal-principal agency model in an important emerging market, Brazil.

scholarly journals Democratization and Civic Capital

2013 ◽  
Author(s):  
Luigi Guiso ◽  
Paolo Pinotti
Keyword(s):  
Voting Rights ◽  
Civic Culture ◽  
Adult Males ◽  
The South ◽  
Private Benefits ◽  
The North ◽  
Civic Capital ◽  
Post War ◽  
Almost All ◽  
High Sense

This chapter documents a sharp reversal in electoral participation between the North and the South of Italy after the 1912 enfranchisement which extended voting rights from a limited élite to (almost) all adult males. When voting was restricted to the élite, electoral turnout was higher in the South but falls significantly below that in the North after the enfranchisement. This gap has never been bridged over the following century and participation remains lower in the South despite the enrichment of democratic institutions and extension of voting rights to women during the post-war democratic republic. This pattern is consistent with a simple theoretical framework in which individuals' voting in political elections is affected by private benefits and civic duty. Only elites can grab private benefits from participation in politics, and civic culture differs across communities. Extension of voting rights to non-elites results in a significant transfer of power to their political organizations only among populations with a high sense of civic duties. Together with the gap in participation between North and South our findings suggest that democratization can benefit non-elites only when the latter have already a high sense of civic capital and is unlikely to induce norms of civic behavior.

Are controlling shareholders extracting private benefits from European public acquisitions?

2015 ◽  
Vol 11 (1) ◽  
pp. 80-96 ◽  
Author(s):  
Mohamed Firas Thraya
Keyword(s):  
Voting Rights ◽  
High Tech ◽  
Private Benefits ◽  
Cross Sectional ◽  
Controlling Shareholder ◽  
Content Type ◽  
Controlling Shareholders ◽  
Private Benefits Of Control ◽  
European Public ◽  
Cash Flow Rights

Purpose – The purpose of this paper is to examine the incentives of controlling shareholders in the market for corporate control. The author investigates the takeover premiums paid by a sample of European acquiring firms with voting rights structures that are highly concentrated. The results show a positive relationship between takeover premiums and the bidder’s concentration of both voting rights and excess voting rights over cash-flow rights. The author argues that with higher levels of entrenchment, takeover premiums reflect the private benefits of control which controlling shareholders in bidding firms seek to extract from a public transaction. Design/methodology/approach – This paper uses cross-sectional regression analyses to examine the relationship between takeover premiums and the extent to which bidding firm shareholders exert control as well as the arrangement which underlie this. The sample is composed by 210 deals. The data are collected from various databases (Thomson Financial’s Mergers and Acquisition; Faccio and Lang’s (2002); Datastream/Worldscope, LexisNexis). Findings – The premium paid in European M&A transactions is affected by the level of ownership exerted by the controlling shareholder. The results show premiums are positively and significantly associated with higher levels of voting rights, as well as, the level of separation of ownership and control when controlling shareholder ownership is low. Pyramiding structure seems to be the means of separation the most associated with takeover premiums. Research limitations/implications – This paper can be improved by other specifications. First, it would be interesting to analyze premiums paid by firms with dispersed ownership structure and to compare these premiums with those paid by firms with controlling shareholders. Second, the author suggests to examine whether a controlling shareholder occupy the seat of a CEO or a chairman. In these cases, the author assumes that the controlling shareholder can benefit from more discretion and can extract more private benefits. Third, the author suggests extending the sample period to 2007 at least to include the sixth wave. This wave was even more significant than the high-tech wave and has not been studied much. In these cases, the author assumes that the controlling shareholder can benefit from more discretion and can extract more private benefits. Originality/value – Previous studies show that the premium reflects the private benefits of control in privately negotiated transactions (mainly block transactions). In the present study, the author shows that the premium can also reflect private benefits in public merger transactions.

scholarly journals ”The good, the bad, and the ugly” private benefits of control and their regulatory implications

2008 ◽  
Vol 5 (4) ◽  
pp. 477-491 ◽  
Author(s):  
Alessio M. Pacces
Keyword(s):  
Corporate Governance ◽  
Corporate Control ◽  
Legal Protection ◽  
Corporate Law ◽  
Legal Institutions ◽  
Minority Shareholders ◽  
Private Benefits ◽  
Controlling Shareholders ◽  
Private Benefits Of Control ◽  
The Law

This paper attempts to shed a new light on the economics and the law of corporate governance. It so does by taking stock of the weaknesses of the standard account of how law ‘matters’ for separation of ownership and control. This account fails to explain comparative corporate governance. Both the ownership structure and the functioning of the market for corporate control do not seem to depend entirely on the strength with which non-controlling shareholders are protected by corporate law. Without claiming that legal protection of minority shareholders does not matter in corporate governance, this paper shows that protection and exchange of corporate control is at least as important and so are the legal institutions that support them. This result is derived by introducing a third category of private benefits of control (idiosyncratic PBC), which supplements the more traditional specifications as inefficient consumption of control perquisites (distortionary PBC) or outright expropriation of shareholder value (diversionary PBC).The implications for corporate law are broader than those of the ‘law matters’ framework. Even though legal institutions effectively constrain expropriation of non-controlling shareholders, they may still make corporate governance inefficient when they fail to provide entitlements to uncontested control in dependently of how much ownership is retained by corporate controllers. Likewise, regulation may undermine the takeover process when it restricts side payments that ultimately support efficient bargaining upon the value of corporate control

Stanley Mandelstam, 1928–2016: Brief biography and selected publications with commentary

2017 ◽  
Vol 32 (12) ◽  
pp. 1740012
Author(s):  
Ling-Lie Chau
Keyword(s):  
Mathematical Physics ◽  
Current Status ◽  
Major Research ◽  
Physical Universe ◽  
The Future ◽  
Almost All ◽  
Rare Opportunity ◽  
Selection Of

The enduring influences of Stanley Mandelstam’s publications are deep and diverse. They affect almost all the current major research efforts in theoretical and mathematical physics that try to deepen our understanding of the physical universe. Reviewing Stanley’s accomplishments offers a rare opportunity for everyone interested, experts as well as nonexperts, to gain a perspective about the current status of theoretical and mathematical physics and what to look for in the future. This paper presents a brief biography of Stanley and a selection of his publications, grouped together according to subject matters, with commentary. 2 2 For a very short highlight of this paper, see author's Physics Today Obituary for Stanley Mandelstam, May issue 2017. About the genesis of these two papers see the Acknowledgments in this paper.

scholarly journals Staggered Boards and the Value of Voting Rights

2021 ◽  
Author(s):  
Oğuzhan Karakaş ◽  
Mahdi Mohseni
Keyword(s):  
Voting Rights ◽  
Option Prices ◽  
Private Benefits ◽  
Cross Sectional ◽  
Staggered Boards ◽  
The Cross ◽  
Voting Premium ◽  
The Impact

Abstract This paper examines the impact of staggered boards on the value of voting rights (i.e., the voting premium) estimated using option prices. We find companies with staggered boards have a higher voting premium. Exploiting plausibly exogenous court rulings, we confirm that weakening the effectiveness of staggered boards decreases the voting premium. Given that the voting premium reflects private benefits consumption and associated managerial inefficiencies, our findings are consistent with the entrenchment view of staggered boards. Analyzing the cross-sectional heterogeneity in our sample, we find the entrenchment effect of staggered boards to be particularly pronounced for firms in noncompetitive industries and for mature firms.

Pocket E-Li: Listening Assessment Made Easy

2019 ◽  
Vol 3 (1) ◽  
pp. 4
Author(s):  
Norazean Sulaiman ◽  
Nurul Nadiah Dewi Faizul Ganapathy ◽  
Wan Faizatul Azirah Ismayatim
Keyword(s):  
Mobile Application ◽  
Listening Comprehension ◽  
Teaching And Learning ◽  
Positive Response ◽  
Mobile Apps ◽  
Listening Skills ◽  
Current Technology ◽  
The Future ◽  
Level Of Understanding ◽  
Almost All

Listening skills should be given more attention as listening takes precedence over anything else when it comes to acquiring a language (Putriani, Sukirlan & Supriyadi, 2013). Even with the booming of various technology to facilitate teaching and learning of listening skills in class, the assessment conducted to identify students’ level of understanding of certain topic is still not up-to-date and not parallel with the advancement of technology. The current studies show that the use of mobile apps for listening purpose is proven to be effective in reducing students’ anxiety (Rahimi & Soleymani, 2015), sustaining students’ motivation (Read & Kukulska-Hulme, 2015), and improving students’ linguistic competencies (Ramos & Valderruten, 2017). This study is aimed to test the effectiveness of mobile application in assessing students’ listening skills. Diploma students from various faculties in UiTM Shah Alam were randomly chosen to answer listening comprehension questions via the prototype developed, named Pocket E-Li. The results demonstrate that the majority of the students provided positive response towards the implementation of mobile application for listening assessment. Almost all respondents agreed that listening assessment should be conducted via mobile application in the future. It can be concluded that listening assessment via mobile application is beneficial to students since it meets the students’ demands and needs which is equivalent with the use of current technology.

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