有关股权结构的外文论文(英文版)(pdf 27页)

Country-specifi c institutional effects on ownership: concentration and performance of continental European fi rms Victoria Krivogorsky Gary Grudnitski Published online: 6 June 2009 ? Springer Science+Business Media, LLC. 2009 Abstract This paper examines the effect of country-specifi c institutional con- structs on the relationship between ownership concentration and performance for fi rms in the eight Continental European countries of Austria, Belgium, Germany, Spain, France, Italy, the Netherlands and Portugal. Using data from publicly-traded fi rms owned by other companies (i.e., blocks), measures of the quality of investor and creditor protection and the effectiveness of legal institutions are applied. Employing a hierarchical moderated multiple regression analysis, differential validity is established for the relationship between ownership concentration and performance as measured by return on shareholders funds. This differential effect comes from creditor protection regimes and is consistent with a relational corporate governance model based on debt fi nance and concentrated ownership. Keywords Ownership concentration ? Country-specifi c institutional effects ? Differential effects ? Creditors and investors protection regimes ? Legality ? Corporate governance ? Relational-based systems 1 Introduction As greater emphasis is placed on global investing, the comparability of business environments has taken on an increased level of importance. This emphasis has created a heightened interest in research that provides evidence about the effect of diverse controlling business environments on the fi nancial position of companies. Accordingly, this study is framed by recent developments in the corporate governance literature related to the role of institutional environments in corporate V. Krivogorsky ( Pistor 2004) identifi es two major types of markets which distinguish major corporate governance models: equity fi nance and control by capital markets (market-centered), and debt fi nance and control by banks (relational investor or controlling shareholder). Market-centered systems are found mainly in common law countries such as the US and UK. They rely heavily on market-related monitoring arrangements, and have built-in incentives and disciplinary techniques designed to achieve superior managerial performance. Further, market-centered systems are characterized by widely-spread shareholding and thick fi nancial markets. In contrast to market-centered systems, relational investor systems exist in most countries outside of the US and UK. Relational investor systems are characterized by controlling inside coalitions, and thin trading of non-controlling stakes.1An important characteristic of relational investor systems is the existence of signifi cant banks, families, institutions and inter-corporate holdings (Faccio and Lang 2002), fi rms with high debt-to-equity ratios and close ties to banks and in some cases, fi rms owned by government or state entities.2It is believed that the controlling shareholder or dominant owner can help alleviate agency problems and serve as a substitute or compliment to the market for corporate control (Jensen 1986; Mikkelson and Partch 1997; Shleifer and Vishny 1986). By introducing the dominant owner concept, we attempt to embrace the literature on the congruence of voting and cash fl ow rights, and European laws impacting this 1 For example, according to the Netherlands Bureau for Economic Policy Analysis, in Germany 57% of all large shareholders held more than 50% of an individual companys stock, and 22% of all large shareholders held more than 75% of an individual companys stock. Additionally, in France, 59% of the large fi rms had a majority owner. 2 The World Bank/IFC survey (found at ) reports that in 2007 the average ownership concentration of fi rms in Italy and Austria was 58%, Germany 48%, Belgium 54%, and the Netherlands 39%. These ownership concentrations for CE countries are in contrast to an average con- centration rate of 19% for the UK. Country-specifi c institutional effects on ownership169 123 congruence. Because the European Unions directive on large shareholdings (88/ 627/EEC) is not supported by an effi cient enforcement mechanism, meaningful cross-country analysis is limited. As identifi ed in European Association of Security Exchange Dealers Corporate Governance Principles and Recommendations, cash fl ow rights in CE fi rms are widely dispersed and initial shareholders use one of a variety of legal mechanisms (e.g., non-voting stock, trust company certifi cates, voting rights restrictions) to retain or lock-in control of these fi rms. Generally the controlling owner of a fi rm is defi ned as the one who controls an absolute majority (i.e., over 50%) of the voting rights, or holds enough voting rights to have de facto control. The de facto control threshold varies across CE countries. For example, in France it is 40% whereas the mandatory bid threshold is 33.3%. As a consequence of the difference in these two levels, an acquirer of a fi rm has to make a mandatory takeover offer for all outstanding shares. In Germany the de facto control threshold is 25% and the mandatory bid threshold established by the German Takeover Code of 2002 is 30%. Recent analyses of attempts to control shareholder activism show that monitoring by fi nancial intermediaries can be effi cient in resolving collective action problems among multiple investors (Calomiris and Kahn 1991; Black 1992; Rajan and Diamond 2000). Financial intermediaries can be active in corporate governance and corporate performance issues through the proxy process or through informal discussions and decisions with the board and senior management of a fi rm. In CE countries, thin equity markets and relatively small returns provide additional incentives for fi nancial intermediaries to be active. Another rationale for relational investors to be more active in the controlling shareholder system stems from market liquidity. Black (1990); Coffee (1991, 2002) and Roe (1994) argue that it is precisely the highly liquid nature of the US secondary markets3 that makes it diffi cult to provide incentives to large shareholders to monitor a companys fi nancial position closely. Therefore, concentrated ownership sacrifi ces liquidity, but enhances supervision, whereas dispersed ownership enhances liquidity, but sacrifi ces supervision. Although closer proximity lessens information asymmetry, there is an accompanying loss of critical objectivity. It is also worth noting that controlling shareholder ownership is not just concentrated but stable over time. For example, in some CE countries (e.g., France), companies reward shareholder loyalty by increasing their voting power. As a result, freedom to make long-term investments often means pursuit of growth or private benefi ts extraction at the cost of a suboptimal rate of return on equity investment.4 Hubbard and Love (2000) suggest that the level of private benefi t extractions differs among different types of controlling shareholdersextraction is lower when a controlling shareholders stock is widely-held, as opposed to family-owned, and when the divergence between control and equity is smaller. Obviously, regulatory 3 Enhanced liquidity in secondary markets is considered a benefi t of dispersed ownership. 4 It implies that equity investors in a relational system settle for a lower rate of return than investors in a market system. In the case of institutions, the offsetting advantage lies in long-term business relationships with the issuer. 170V. Krivogorsky, G. Grudnitski 123 impediments matter less when controlling shareholders are involved, (Barca and Becht 2001), unless the regulatory environments are robust enough to hinder the controlling party. The degree of discretion exercised by market institutions in a relational investor system is less than in a market-based system. For example, in a relational investor system governments actively intervene through rule enforcement to determine which issuers have access to public fi nancing. Governments in relational investor systems, however, have shown little interest in specifying rules relating to market microstructure issues or trading technicalities (Jackson and Roe 2008). In areas where market infrastructure institutions enjoy regulatory responsibilities, their powers are not exclusive because in most cases, regulators also bear some authority in these same areas. Often, the law subjects the market institutions discretion in the exercise of its powers to oversight by a government agency. For example, analysis of the regulatory framework in France suggests that rulemaking, monitoring and enforcement of activities related to disclosure, corporate governance and market abuse are under the Authorite des Marche s Financieres (AMF administrative agency) supervision.5In addition, all AMF rules require the approval of the Ministry of Finance before going into force, and the Ministry can infl uence the AMF deliberation process through its directly appointed representative on the AMF board. 2.2 The role of government agencies and institutions in regulation While the importance of investor and creditor protection has been addressed before by LaPorta et al. (1998, 1999, 2000), Bushman and Smith (2001), Gugler et al. (2003), and Gilson (2005), this study adopts a different perspective on the role of institutional environments. First, we recognize that CE countries have a distinct pattern of allocation of regulatory powers to government agencies and market institutions. Coffee (2007) and Jackson and Roe (2008) characterize this pattern as a government-led model. In a government-led model, a central government shapes the regulatory frameworks (regardless of a specialized administrative agency) to maintain a tight grip over securities markets. Regulatory powers of market institutions6 are conversely specifi c, carefully defi ned, and relate to areas where the involvement of market institutions is strictly necessary (e.g., the trading process). Even in these limited areas, the exercise of regulatory powers by market institutions is often subject to approval by an administrative agency. Allocation of powers in countries following the government-led model is consistent with the view that stock exchanges are effective in regulating certain aspects of securities markets where their involvement is either strictly necessary or hugely benefi cial. Even in these aspects, however, the regulatory role of stock exchanges is kept to a bare minimum. 5 In Germany these activities are under the supervision of Bundesanstalt fu r Finanzdienstleistungsauf- sicht (an amalgamation of the administrative agencies previously responsible for the German insurance, banking and securities industries) and Deutsche Bo rse (the Ministry of Finance). 6 Market regulatory institutions can be considered as stock exchanges that provide a regulatory framework for the operation of an organized market. Country-specifi c institutional effects on ownership171 123 In contrast to a government-led environment of limited rulemaking and authority granted to markets, issuer disclosure in the US and UK for example, constitutes the primary channel through which the market familiarizes itself with a fi rm. Especially as ongoing disclosure takes place through bulletins and other methods of dissemination of information that stock exchanges operate, the case for stock exchanges retaining some regulatory powers over issuer disclosure is particularly strong. The second perspective we adopt is one in which institutional environments act as intermediaries in limiting opportunistic behavior Report of Center for European Policy Studies (CEPS) 1995. Specifi cally, indices of investor protection7based on the role of professional judges and attorneys, the level of legal justifi cation required in the process of dispute resolution, and the level of statutory control of or intervention in a companys administration are used. Further, CE states have traditionally provided creditors with safeguards by emphasizing creditors protec- tion in both corporate law and bankruptcy law (Enriques and Gelter 2006).8In particular, to measure the strength of creditors rights, we fi nd indices of creditor protection based on an analysis of practices utilized in each CE country to enforce information correctness,9creditors legal rights, and the level of information disclosure available in the registries of these countries. While the role of investor and creditor protection law on the books of a country is instrumental in limiting opportunistic behavior, the picture is incomplete without a measure of the effectiveness of a countrys institutions to enforce that law. Accordingly, to measure the extent to which rules are consistently and successfully enforced (i.e., their legality), an index constructed by Berkowitz et al. (2003) measuring the effectiveness of legal institutions is employed. 3 Hypotheses development For purposes of this paper, two particular claims are central. First, a controlling shareholder structure found in Continental Europe is associated with so called bad law. This bad law is typically characterized by low equity market activism,10 distinct property relations and capital structure, which correlate with the qualities of the institutional environments fi nancial system architecture and legal environment characteristics (Roe 1994; Bebchuk and Roe 1999). There is no consensus in the literature, however, on why different countries developed different economic strategies, which led to different ownership structures, and, eventually, to different 7 International Monetary Fund (2005). 8 The Second Directive, Article 32 of the European Union Company Law requires a safeguard for creditors in the event of reduction of capital. The Third and Six Directives require safeguards for creditors in case of mergers and divisions (Articles 13 and 12, respectively). 9 Practices to enforce information quality are measured as legal penalties for reporting inaccurate data, the time to correct reported errors (usually less than two weeks), and the possibility of inspecting data. 10 Typically controlling shareholders activism has an important impact on the performance and liquidity of the equity market (Black 1992; Coffee 1991, 2002; Roe 1994). In CE countries, where equity markets are thin and do not generate large returns, there is more reason for activism by concentrated owners. 172V. Krivogorsky, G. Grudnitski 123 regulatory and fi nancial systems. Bebchuk and Roe (1999) advocate an endogenous explanation (i.e., a theory of path dependence) wherein powerful internal parties such as managers and controlling shareholders are able to pressure lawmakers into developing rules that allow internal parties to extract private benefi ts (this is the rent seeking argument). LaPorta et al. (1998) and Leuz et al. (2003) dispute that ownership concentration depends on the quality of regulatory systems. Instead they advocate an exogenous explanation (laws and politics), and the way to improve the effi ciency of any system, whether its ownership is dispersed or concentrated, rests with enhancing the quality of the regulatory environment and its enforcement. The second claim central to this paper is that the function of the institutional environment can be partially described by its role insolving agency confl ict, which in Continental Europe, is complicated in two ways. First, in most situations, agency confl ict is thought to arise from the separation of ownership and control. In the US where shareholdings are widely-held, agency confl ict is evidenced by the role of independent directors serving on boards and instances of market devices such as hostiletakeovers.InContinentalEurope,however,acontrollingshareholderisviewed as a key restraint on public corporation managers. This is the point that motivates the effi ciency defense of controlling shareholder systems. Because controlling share- holders own large equity stakes for extended periods of time, they are more likely to have an incentive either to monitor managers effectively or to manage the company itself, and, because of proximity and lower information costs, nip agency problems in the bud (Jensen 1986; Mikkelson and Partch 1997; Shleifer and Vishny 1986). The other way the agency problem is complicated in Continental Europe relates to the potential for controlling shareholders to extract private benefi ts using a degree of control not afforded to minority shareholders (it drives the bad law/controlling shareholder regime nexus). Conditional on maintaining control, the less equity controlling shareholders have, the greater their incentive to use control to extract private benefi ts. This is due to the fact that increased productivity accrues to shareholders in proportion to their equity, while the private benefi ts of control are allocated based on governance power (Hubbard and Love 2000). The effi ciency of controlling shareholders can be further limited if a fi rm has its own agency problems. Hubbard and Love (2000) suggest that the level of private benefi t extraction is lower when the stock of controlling shareholders is widely held. To make a controlling shareholder system effi cient, institutions must be instrumen- tal in solving agency confl ict by specifying substantive rules, requiring suffi cient disclosure and providing an effective enforcement mechanism to substitute for the systems lack of effi ciency (Berndt 2000). For instance, LaPorta et al. (1999, 2000) have identifi ed various characteristics of the legal environment, such as the level of investor and creditor protection, as being benefi cial in solving the agency problem. Additionally, Berkowitz et al. (2000, 2003) argue that enforcement and effective legal instit