Enforcement and Corporate Governance
Enforcement more than regulations, laws-on-the-books, or voluntary codes is key to effective corporate governance, at least in transition and developing countries. Corporate governance and enforcement mechanisms are intimately linked as they affect...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, D.C.
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2004/09/5163974/enforcement-corporate-governance http://hdl.handle.net/10986/14242 |
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okr-10986-142422021-04-23T14:03:21Z Enforcement and Corporate Governance Berglöf, Erik Claessens, Stijn ACTUAL COSTS ASSET STRIPPING ASSETS AUDITORS AUDITS BANK LENDING BANK MONITORING BANKING REGULATION BANKING SYSTEM BANKRUPTCY BANKRUPTCY LAW BROKERS CAPITAL MARKETS CLEARING HOUSES COLLATERAL CONTRACT ENFORCEMENT CORPORATE CONTROL CORPORATE GOVERNANCE CORPORATE PERFORMANCE COST OF CAPITAL DEBT DEVELOPED COUNTRIES DISCLOSURE ECONOMIC GROWTH ECONOMICS ECONOMIES OF SCALE EMERGING MARKETS EMPIRICAL EVIDENCE EQUILIBRIUM EXPROPRIATION EXTERNAL FINANCING FACTOR MARKETS FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STRUCTURE FOREIGN FIRMS FOREIGN INVESTORS GOVERNANCE PROBLEM GOVERNMENT INTERVENTION HUMAN CAPITAL INFORMATION DISSEMINATION INSIDER TRADING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL INVESTORS INTERNATIONAL FINANCE INVESTMENT BANKS INVESTMENT STRATEGIES JOINT VENTURES JUDICIAL SYSTEM JURISDICTIONS LABOR MARKETS LAWS LIABILITY LINKAGES LIQUIDITY LIQUIDITY COSTS MARKET ECONOMIES MEDIA MINORITY SHAREHOLDERS NATURAL RESOURCES OIL OWNERSHIP CONCENTRATION POLICY RESEARCH POLITICAL ECONOMY PRIVATE PROPERTY PROPERTY RIGHTS PROXY PROXY FIGHTS PUBLIC POLICY RATE OF RETURN RATING AGENCIES REGULATORY ENVIRONMENT RENT SEEKING RISK MANAGEMENT SECURITIES SECURITIES LAWS SECURITIES MARKETS SETTLEMENT SHAREHOLDER VALUE SHAREHOLDERS SHAREHOLDINGS SOCIAL COSTS STOCK EXCHANGES STOCK MARKET STOCK MARKETS STOCKS SUPERVISORY FRAMEWORK SUPPLIERS TRADE CREDIT TRADEOFFS TRADERS TRANSACTION COSTS TRANSITION ECONOMIES Enforcement more than regulations, laws-on-the-books, or voluntary codes is key to effective corporate governance, at least in transition and developing countries. Corporate governance and enforcement mechanisms are intimately linked as they affect firms' ability to commit to their stakeholders, in particular to external investors. The authors provide a framework for understanding these links and how they are shaped by countries' institutional contexts. When the general enforcement environment is weak and specific enforcement mechanisms function poorly, as in many developing and transition countries, few of the traditional corporate governance mechanisms are effective. The principal consequence in these countries is a large block-holder, but there are important potential costs to this mechanism. A range of private and public enforcement "tools" can help reduce these costs and reinforce other supplementary corporate governance mechanisms. The limited empirical evidence suggests that private tools are more effective than public forms of enforcement in the typical environment of most developing and transition countries. However, public enforcement is necessary regardless, and private enforcement mechanisms often require public laws to function. Furthermore, in some countries at least, bottom-up, private-led tools preceded and even shaped public laws. Political economy constraints resulting from the intermingling of business and politics, however, often prevent improvements in the general enforcement environment, and adoption and implementation of public laws in these countries. 2013-06-27T17:53:55Z 2013-06-27T17:53:55Z 2004-09 http://documents.worldbank.org/curated/en/2004/09/5163974/enforcement-corporate-governance http://hdl.handle.net/10986/14242 English en_US Policy Research Working Paper;No.3409 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, D.C. Publications & Research :: Policy Research Working Paper Publications & Research |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ACTUAL COSTS ASSET STRIPPING ASSETS AUDITORS AUDITS BANK LENDING BANK MONITORING BANKING REGULATION BANKING SYSTEM BANKRUPTCY BANKRUPTCY LAW BROKERS CAPITAL MARKETS CLEARING HOUSES COLLATERAL CONTRACT ENFORCEMENT CORPORATE CONTROL CORPORATE GOVERNANCE CORPORATE PERFORMANCE COST OF CAPITAL DEBT DEVELOPED COUNTRIES DISCLOSURE ECONOMIC GROWTH ECONOMICS ECONOMIES OF SCALE EMERGING MARKETS EMPIRICAL EVIDENCE EQUILIBRIUM EXPROPRIATION EXTERNAL FINANCING FACTOR MARKETS FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STRUCTURE FOREIGN FIRMS FOREIGN INVESTORS GOVERNANCE PROBLEM GOVERNMENT INTERVENTION HUMAN CAPITAL INFORMATION DISSEMINATION INSIDER TRADING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL INVESTORS INTERNATIONAL FINANCE INVESTMENT BANKS INVESTMENT STRATEGIES JOINT VENTURES JUDICIAL SYSTEM JURISDICTIONS LABOR MARKETS LAWS LIABILITY LINKAGES LIQUIDITY LIQUIDITY COSTS MARKET ECONOMIES MEDIA MINORITY SHAREHOLDERS NATURAL RESOURCES OIL OWNERSHIP CONCENTRATION POLICY RESEARCH POLITICAL ECONOMY PRIVATE PROPERTY PROPERTY RIGHTS PROXY PROXY FIGHTS PUBLIC POLICY RATE OF RETURN RATING AGENCIES REGULATORY ENVIRONMENT RENT SEEKING RISK MANAGEMENT SECURITIES SECURITIES LAWS SECURITIES MARKETS SETTLEMENT SHAREHOLDER VALUE SHAREHOLDERS SHAREHOLDINGS SOCIAL COSTS STOCK EXCHANGES STOCK MARKET STOCK MARKETS STOCKS SUPERVISORY FRAMEWORK SUPPLIERS TRADE CREDIT TRADEOFFS TRADERS TRANSACTION COSTS TRANSITION ECONOMIES |
| spellingShingle |
ACTUAL COSTS ASSET STRIPPING ASSETS AUDITORS AUDITS BANK LENDING BANK MONITORING BANKING REGULATION BANKING SYSTEM BANKRUPTCY BANKRUPTCY LAW BROKERS CAPITAL MARKETS CLEARING HOUSES COLLATERAL CONTRACT ENFORCEMENT CORPORATE CONTROL CORPORATE GOVERNANCE CORPORATE PERFORMANCE COST OF CAPITAL DEBT DEVELOPED COUNTRIES DISCLOSURE ECONOMIC GROWTH ECONOMICS ECONOMIES OF SCALE EMERGING MARKETS EMPIRICAL EVIDENCE EQUILIBRIUM EXPROPRIATION EXTERNAL FINANCING FACTOR MARKETS FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STRUCTURE FOREIGN FIRMS FOREIGN INVESTORS GOVERNANCE PROBLEM GOVERNMENT INTERVENTION HUMAN CAPITAL INFORMATION DISSEMINATION INSIDER TRADING INSTITUTIONAL DEVELOPMENT INSTITUTIONAL INVESTORS INTERNATIONAL FINANCE INVESTMENT BANKS INVESTMENT STRATEGIES JOINT VENTURES JUDICIAL SYSTEM JURISDICTIONS LABOR MARKETS LAWS LIABILITY LINKAGES LIQUIDITY LIQUIDITY COSTS MARKET ECONOMIES MEDIA MINORITY SHAREHOLDERS NATURAL RESOURCES OIL OWNERSHIP CONCENTRATION POLICY RESEARCH POLITICAL ECONOMY PRIVATE PROPERTY PROPERTY RIGHTS PROXY PROXY FIGHTS PUBLIC POLICY RATE OF RETURN RATING AGENCIES REGULATORY ENVIRONMENT RENT SEEKING RISK MANAGEMENT SECURITIES SECURITIES LAWS SECURITIES MARKETS SETTLEMENT SHAREHOLDER VALUE SHAREHOLDERS SHAREHOLDINGS SOCIAL COSTS STOCK EXCHANGES STOCK MARKET STOCK MARKETS STOCKS SUPERVISORY FRAMEWORK SUPPLIERS TRADE CREDIT TRADEOFFS TRADERS TRANSACTION COSTS TRANSITION ECONOMIES Berglöf, Erik Claessens, Stijn Enforcement and Corporate Governance |
| relation |
Policy Research Working Paper;No.3409 |
| description |
Enforcement more than regulations,
laws-on-the-books, or voluntary codes is key to effective
corporate governance, at least in transition and developing
countries. Corporate governance and enforcement mechanisms
are intimately linked as they affect firms' ability to
commit to their stakeholders, in particular to external
investors. The authors provide a framework for understanding
these links and how they are shaped by countries'
institutional contexts. When the general enforcement
environment is weak and specific enforcement mechanisms
function poorly, as in many developing and transition
countries, few of the traditional corporate governance
mechanisms are effective. The principal consequence in these
countries is a large block-holder, but there are important
potential costs to this mechanism. A range of private and
public enforcement "tools" can help reduce these
costs and reinforce other supplementary corporate governance
mechanisms. The limited empirical evidence suggests that
private tools are more effective than public forms of
enforcement in the typical environment of most developing
and transition countries. However, public enforcement is
necessary regardless, and private enforcement mechanisms
often require public laws to function. Furthermore, in some
countries at least, bottom-up, private-led tools preceded
and even shaped public laws. Political economy constraints
resulting from the intermingling of business and politics,
however, often prevent improvements in the general
enforcement environment, and adoption and implementation of
public laws in these countries. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Berglöf, Erik Claessens, Stijn |
| author_facet |
Berglöf, Erik Claessens, Stijn |
| author_sort |
Berglöf, Erik |
| title |
Enforcement and Corporate Governance |
| title_short |
Enforcement and Corporate Governance |
| title_full |
Enforcement and Corporate Governance |
| title_fullStr |
Enforcement and Corporate Governance |
| title_full_unstemmed |
Enforcement and Corporate Governance |
| title_sort |
enforcement and corporate governance |
| publisher |
World Bank, Washington, D.C. |
| publishDate |
2013 |
| url |
http://documents.worldbank.org/curated/en/2004/09/5163974/enforcement-corporate-governance http://hdl.handle.net/10986/14242 |
| _version_ |
1764430687992020992 |