 Governance and Corporate Control around the WorldPanagiotis Kyriakogkonas, Panagiotis Giannopoulos, Alexandros Garefalakis and Andreas Koutoupis Chapter 9 in Governance and Financial Performance:Current Trends and Perspectives, 2023, pp 195-228 from World Scientific Publishing Co. Pte. Ltd. Abstract: Corporate control, within the context of the capitalism, could take many forms that might make communication among various groups, such as academics, public authorities or employees of any level, difficult and complicated. In the US and other developed countries, capitalism is formed through a large number of corporations of any size who compete with each other, while monopolies are prohibited. Owners of those corporations, the shareholders, especially the minor ones, are usually disorganized and powerless, while other corporations or even state-owned corporations act as shareholders of other corporations and promote their interests through active participation in management with, among others, the selection and the influence of Board members. CEOs, as the heads of management of such corporations, even audited and controlled by many mechanisms in place, could affect decision-making of those corporations by incorporating their personal beliefs and mindsets, cultural influences and political beliefs in their decision-making process. In less developed countries, capitalism is formed through the creation of corporations by wealthy families, with limited number of shareholders, and there are many cases that members of the family possess the vast majority of shareholders’ voting rights. The owners of such corporations might sometimes have the power to affect governments’ decision-making in order to gain advantage over their competitors, so even though monopolies are prohibited, the actual situation is far away from the terms of perfect competition.Within this economic context, historically, the evolution of corporate governance has been affected by several factors and events that took place during financial history. Those factors and events not only contributed to the evolution of corporate governance but also differentiated its content among countries with different corporate control types, different cultures, economic power, etc. Emergency events at countries’ history like wars, changes in political systems, etc., along with major economic crises due to corporate collapses led corporate governance to emerge and to evolve. Reinforcement of concentration of corporations by wealthy families in some countries, along with the decline of power of some wealthy families in other countries and the corresponding corporate failures, created discrepancies among countries to the applicable legislation for corporate governance. The formation of big business groups, through mergers, acquisitions and creation of new corporations as a response to cope with competition, created new risks for shareholders and stakeholders that had to deal with effectively by legislative authorities, within the context of corporate governance and the established mechanisms of corporate control. The rapid evolution of technology in recent years that had massive impact on privacy issues led to the creation of relevant legislation that had also impact on the governance model of the corporations and on elements of control of corporations. Legislation itself is a factor that not only is affected by the evolution of corporate governance but also affects and triggers its revolution. Capital markets legislation, for example, affects the behavior of shareholders, especially of controlling shareholders who might set up their strategy extending from passive block holders to active participants with diversified portfolios of investments.This chapter presents basic corporate control types and their influences on their formation by cultural and other factors. Also, this chapter presents basic corporate governance types and their relationship with corporate control types at various countries around the world, based on 2019 recent studies by OECD. Keywords: Corporate Governance System; Agency Theory; Return on Assets; Stock Return; Firm Performance; Responsible Management and ESG (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:wsi:wschap:9789811260506_0009 Ordering information: This item can be ordered from Access Statistics for this chapter More chapters in World Scientific Book Chapters from World Scientific Publishing Co. Pte. Ltd. |
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