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CBR Summit: Innovation and Governance 29-30 March 2006
- I. Shareholder protection index (extract)
Shareholder Protection: A Leximetric Approach Mathias Siems & - - PowerPoint PPT Presentation
Shareholder Protection: A Leximetric Approach Mathias Siems & - - PowerPoint PPT Presentation
Comparative Company Law Shareholder Protection: A Leximetric Approach Mathias Siems & Priya Lele Centre for Business Research University of Cambridge CBR Summit: 29-30 March 2006 Innovation and Governance I. Shareholder protection index
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CBR Summit: Innovation and Governance 29-30 March 2006
- I. Shareholder protection index
60 variables which function as proxies for shareholder protection in general For instance, for protection against majority shareholders: – mandatory law – public enforcement – quorum and supermajority requirements – fiduciary principles – appraisal rights
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CBR Summit: Innovation and Governance 29-30 March 2006
- II. Coding the Law
- Coding shareholder protection for the UK, the US, Ger-
many, France, and India for the last 35 years; e.g.,
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CBR Summit: Innovation and Governance 29-30 March 2006
- II. Coding the law
- Problems in coding the law: e.g.,
– not only mandatory but also default rules – not only statutory but also case law – not only “formal law”, but also Table A, corporate governance rules, and listing rules – not only binary numbers but also non binary numbers
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CBR Summit: Innovation and Governance 29-30 March 2006
III.1: General aggregate (60 variables)
24 26 28 30 32 34 36 38 40 1970 1975 1980 1985 1990 1995 2000 2005 UK US France Germany India
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CBR Summit: Innovation and Governance 29-30 March 2006
III.2: Protection against boards (42 var.)
17 19 21 23 25 27 29 31 1970 1975 1980 1985 1990 1995 2000 2005 UK US France Germany India
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CBR Summit: Innovation and Governance 29-30 March 2006
III.3: Protection against other shareholders (18 variables)
5 6 7 8 9 10 11 12 13 14 15 1970 1975 1980 1985 1990 1995 2000 2005 UK US France Germany India
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CBR Summit: Innovation and Governance 29-30 March 2006
Again: General aggregate (60 variables)
24 26 28 30 32 34 36 38 40 1970 1975 1980 1985 1990 1995 2000 2005 UK US France Germany India
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CBR Summit: Innovation and Governance 29-30 March 2006
III.4: Difference from French law (max: 60)
10 12 14 16 18 20 22 24 26 28 30 1970 1975 1980 1985 1990 1995 2000 2005 Germany UK US India
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CBR Summit: Innovation and Governance 29-30 March 2006
III.5: Difference from English law (max: 60)
10 12 14 16 18 20 22 24 26 28 30 1970 1975 1980 1985 1990 1995 2000 2005 Germany France US India
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CBR Summit: Innovation and Governance 29-30 March 2006
III.6: Mean of all differences (max. 60)
17 18 19 20 21 22 1980 1985 1990 1995 2000 2005
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CBR Summit: Innovation and Governance 29-30 March 2006
- IV. Final remarks
“Not everything that counts can be counted, and not everything that can be counted counts.” (Sign hanging in Albert Einstein’s office at Princeton) How it will be going on
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CBR Summit: Innovation and Governance 29-30 March 2006
Annex: (main) variables
- I. Protection against board and management: 1. Powers of
the general meeting; 2. Agenda setting power; 3. Extraordinary shareholder meeting; 4. Anticipation of shareholder decision; 5. Information in the run-up of the general meeting; 6. Shares not blocked before general meeting; 7. Individual information rights; 8. Communication with other shareholders; 9. Board composition; 10.No excessive remuneration; 11. Performance based remuneration; 12. Duration of director’s appointment; 13. Directors duties; 14. Shareholder supremacy; 15. Preemptive rights; 16. Director’s disqualification; 17. Corporate governance code; 18. Public enforcement of company law
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CBR Summit: Innovation and Governance 29-30 March 2006
Annex: (main) variables
- II. Protection against other shareholders: 1. Quorum; 2.