scholarly journals Shifting Paradigm? Long-Term Value Creation as a Normative Principle in a Hostile Takeover: Evidence from the Netherlands

2018 ◽  
Vol 4 (2) ◽  
pp. 91
Author(s):  
N.T. Pham T.L.M Verdoes ◽  
J. Nijland
Keyword(s):  
Corporate Governance ◽  
The Netherlands ◽  
Value Creation ◽  
Sustainable Growth ◽  
Hostile Takeover ◽  
Governance System ◽  
Business World ◽  
World Government ◽  
Short Termism

This article provides additional insight on the effectiveness of long-term value creation as a legally enforceable norm in the corporate governance system and provides a framework to anchor long-term value creation in takeover decisions. Since the 2008 financial crisis, a growing number of voices in the business world, government and academia, have urged Western economies to move towards a long-term sustainable growth agenda. Boards have a vital part to play in the development of responsible companies. Corporate governance should encourage boards to do so. This could be viewed as a reaction to the negative effects of capital markets and the resulting short-termism. One key method to encourage sustainable value creation in companies is by incorporating long-term value creation as an open norm in corporate governance systems. In the case of a hostile takeover, the risk of short-termism is exacerbated. As a guiding principle, long-term value (LTV) creation should prevent hostile takeovers that could harm the success of the company concerned. In this research paper, we argue that the recent shift in Dutch case law and revision of the Corporate Governance Code in the Netherlands may serve as an important catalyst for ‘sustainable’ takeover decisions. Through ground-breaking judgments by the Dutch Supreme Court and Enterprise Court, Cancun and Akzo Nobel, LTV has acquired the status of an enforceable norm. We investigated whether this legal norm is empirically substantiated. The research results allow us to make well-grounded statements about the effectiveness of enforcing LTV in future hostile takeover situations.

Corporate Governance and Value Creation

2016 ◽  
Vol 7 (2) ◽  
pp. 51-61 ◽  
Author(s):  
Neeta Baporikar
Keyword(s):  
Corporate Governance ◽  
Value Creation ◽  
Focal Point ◽  
Major Influence ◽  
Governance System ◽  
Business World ◽  
Decision Making Processes ◽  
Innovation Capacity ◽  
A Company

Corporate governance is a complex issue, the focal point of which is the exercise of power. The power has limits, however, imposed by both legislation and contracts. Also, even if the overarching power belongs to the shareholders, residual power cannot be exercised to the detriment of the rights of the other stakeholders. Because the governance system and resulting structures have a major influence on the decision-making processes within a company, financial analysts must understand the governance mechanisms. Moreover, in the business world today, corporate governance is a factor in competitiveness that is as important as the quality of a company's human resources, its know-how, and its innovation capacity. Through in-depth literature review and contextual analysis the aim of this paper is to under the corporate governance perspective and also to review for understanding the corporate governance and value creation experience from India.

scholarly journals The Impact of Corporate Governance on Company Performance: A Study among Medium and Large Enterprises in Kosovo

2018 ◽  
Vol 9 (6) ◽  
pp. 207-212
Author(s):  
Saxhide Mustafa ◽  
Hajdin Berisha ◽  
Shyqyri Llaci
Keyword(s):  
Corporate Governance ◽  
Company Performance ◽  
Governance System ◽  
Market Experience ◽  
Corporate Governance System ◽  
Governance Practices ◽  
The Impact ◽  
Proper Balance ◽  
Large Enterprises

Abstract An effective corporate governance system is established to ensure proper balance of long-term interests of different stakeholders (primarily: owners, employees and management) and improve company's performance and its competitive position in the market. This paper provides a theoretical discussion and empirical evidence on the interdependence between corporate governance and company performance among medium and large enterprises in Kosovo. A questionnaire survey was employed for data collection purposes. The study included a sample of 87 managers from 87 medium and large enterprises. Results indicate that effects of corporate governance on the performance tend to be greater in larger companies. Regarding the determinants, the theoretical expectations are confirmed. Results confirm that the size of the company, the level of investment, export activities and company life expectancy are statistically significant determinants of the adoption of corporate governance practices. As a result, larger companies with large scales of investment and longer market experience tend to adopt more corporate governance practices. The study suggests that corporate governance will inevitably affect companies’ performance and further research is needed in this context.

Is Corporate Social Responsibility Really Able to Create Long-Term Sustainability Value?

2022 ◽  
pp. 194-216
Author(s):  
Manuel Moreno ◽  
Elena Mañas-Alcón ◽  
Oscar Montes-Pineda ◽  
Beatriz Fernández-Olit
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Value Creation ◽  
Social Values ◽  
Shared Value ◽  
Csr Strategies ◽  
Sustainable Value ◽  
Short Run ◽  
Corporate Social

This chapter analyzes the academic debate regarding the need to adopt a long-term vision of CSR strategies. It's based on the premise that short run is the dominant approach in financial markets, and this situation could be negatively conditioning the long-term sustainability value creation. New social values may be requesting different management decisions from companies, prioritizing long-term over short term results. A thorough literature review has been done across specialized journals, international reports, and key legislation, trying to determine and model the elements facilitating this sustainable value creation. It shows the alignment needed between CEO and their shareholders within the framework of corporate governance to create long-term value within CSR. There are signs of a possible financial over-performance of companies that strategically create a shared value with stakeholders based on environmental, social, and governance objectives, selected due to their materiality. A model is proposed to consider a long-term approach creating sustainable value in organizations.

scholarly journals The Effects of Critical Success Factors on Social Enterprises Sustainability

2019 ◽  
Vol 7 (3) ◽  
Author(s):  
Kanchaya Chaivirutnukul ◽  
Achara Chandrachai
Keyword(s):  
Value Creation ◽  
Financial Management ◽  
Critical Success Factors ◽  
Success Factors ◽  
Mean Value ◽  
Social Enterprises ◽  
Sustainable Growth ◽  
Critical Success ◽  
Is Value

This is a mix-method study to investigate critical success factors which can support social enterprises in Thailand to measure their sustainability. The quantitative data were gathered through questionnaire, while qualitative data were derived from semi-structures interview. The data were analyzed by descriptive statistics, a multiple regression, and content analysis. It was found that the highest-correlated factor with sustainable growth for social enterprises is Value Creation with mean value of 4.03. Importantly, Value Creation and The Philosophy of Sufficiency Economy were found to be the important indicators of economic, social, and environmental key performance, while Financial Management was the indicator of economic and environmental key performance of social enterprises in Thailand. The implications of this study shed light on how social enterprises make themselves sustainable and how they measure their sustainability over the long term.

scholarly journals Corporate governance and value creation index

2016 ◽  
Vol 14 (1) ◽  
pp. 241-250
Author(s):  
Niraj Satnalika ◽  
S.V.D. Nageswara Rao
Keyword(s):  
Corporate Governance ◽  
Value Creation ◽  
Survey Methodology ◽  
Good Governance ◽  
Business Environment ◽  
Ripple Effect ◽  
Governance System ◽  
Global Business ◽  
Governance Practices ◽  
Market Capitalisation

This study aims to create a methodology to measure good governance and value creation with the help of an index composed of two sub-indices which corresponds to corporate governance and value creation (CGVC). The proposed index measures corporate governance quality that collapse into one number (a governance rating or index) and helps in analysing the effectiveness of corporate governance index in predicting value creation. We believe there is no one “best” measure of corporate governance, however, the most effective governance system depends on context and firm related circumstances. Thus, it is generally difficult for an index, or any one variable, to capture such nuances which may be critical for making informed decisions. Having said that, the index beautifully helps in giving a fair idea about governance practices followed by companies’ in India. The CGVC index is constituted after investigating governance practices in BSE 100 companies which accounts for nearly 66% of the market capitalisation (as of March 2014). The study investigates corporate governance practices followed by the company in terms of 11 parameters identified (based on various recommendations given by the several committees) coupled with value created for different stakeholders. The period under study (2006-07 to 2013-14) is known for several volatilities and has remained one of the key themes in the global business environment. Economic uncertainties and changing business landscape left investors unnerved. While growth in largest economies declined, it had ripple effect on emerging economies. We have followed a two-step methodology where equal weightage is assigned to both the sub-indices. For sub-indices we have followed survey methodology where we interviewed personnel including board members, entry and mid-level employees of companies, regulatory participants, and stock brokers. Lastly, the paper aims to fill the gaps and conduct a thorough review of corporate governance and its relationship with value creation for one of the fastest growing emerging markets i.e., Indian economy.

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