Einde inhoudsopgave
The Decoupling of Voting and Economic Ownership (IVOR nr. 88) 2012/2.2.0
2.2.0 Introduction
mr. M.C. Schouten, datum 01-06-2012
- Datum
01-06-2012
- Auteur
mr. M.C. Schouten
- JCDI
JCDI:ADS600561:1
- Vakgebied(en)
Ondernemingsrecht / Rechtspersonenrecht
Voetnoten
Voetnoten
See supra section 2.2 and infra section 2.3 and Appendix.
This risk of minority shareholder abuse by blockholders is exacerbated when blockholders have not only significant informal power over the board but also significant formal power, as is the case in many Continental European countries, especially when compared to the US. See S. Cools, 'The Real Difference in Corporate Law Between the United States and Continental Europe: Distribution of Powers' (2005) 30 Delaware Joumal of Corporate Law, 679, 738-750.
Two other empirical studies include variables for ownership disclosure in their indices. The first is a measure of investor protection through securities laws: R. La Porta, F. Lopez-DeSilanes and A. Shleifer, 'What Works in Securities Laws?' (2006) 61 Joumal of Finance 1, 3 (for a critique, see M. Siems, 'What Does Not Work In Comparing Securities Laws: A Critique on La Porta et al.'s Methodology', (2005) 16 International Company and Commercial Law Review 300). In this study, La Porta et al. focus on 'the agency problem between prospective investors in an initial public offering and the 'promoter' who offers shares for sale'. The second is a measure of shareholder protection from self-dealing by corporate insiders through corporate law: S. Djankov, R. La Porta, F. Lopez-de-Silanes and A. Shleifer, 'The Law and Economics of Self-Dealing' (2008) 88 Joumal of Financial Economics 430, 432.
M. Siems, 'Shareholder Protection Around the World (`Leximetric 11')' (2008) 33 Delaware Joumal of Corporate Law 111, 119.
M. Schouten, 'The Case for Mandatory Ownership Disclosure' in (2009) 15 Stanford Joumal of Law, Business and Finance 127, 133.
The basis for our analysis is the CBR shareholder protection index, which traces the development of legal rules over time.1 This index includes several variables that are proxies for protection of shareholders against the board, such as a variable for director independence. Since in countries characterised by concentrated ownership the protection of minority shareholders against dominant shareholders is a key concern, the index also includes several variables that are proxies for protection against dominant shareholders.2
One of the variables that are proxies for protection against dominant shareholders relates to ownership disclosure.3 The motivation to include this variable in the index was that ownership disclosure rules "tell us something about how shareholders are protected in the event of a change of corporate control".4 For the purposes of this chapter, it is useful to discuss the function of ownership disclosure rules in more detail. In doing so, we draw on the insights of Chapter 1, which distinguishes two main functions of ownership disclosure: improving market efficiency and improving corporate governance.5