We develop a model to illustrate that controlling shareholders choose the level of investor protection that maximizes their own interests. Controlling shareholders in companies with complicated control structures can easily extract private benefits and are thus reluctant to enhance investor...

Two recent cases, one from New Zealand and the other from the UK, highlight issues relating to the intersection between company law and securities law. In one, the directors attempted to defend alleged breaches of the statutory duty to make full prospectus disclosure by asserting that they were...

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This article investigates the development of accountability and fiduciary loyalty as an institutional response to information asymmetries in agency relations, especially in firm-like settings. Lord Eldon articulated the crucial role of information asymmetries in opportunistic behaviour in early...

Empirical studies in corporate law have proliferated in the last two decades, and had a major impact on legal practice and policy relating to corporate governance. As a result, lawyers increasingly engage with these studies in order to understand their implications for legal practice and policy....

Because representative shareholder litigation has been constrained by numerous legal developments, the corporate governance system has developed new mechanisms as alternative means to address managerial agency costs. We posit that recent significant governance developments in the corporate world...

In this paper, we propose a model including the trading stage (acquisition of shares and blockholder disclosure) and the governance stage of activism. We analyze the blockholder's timing of disclosure, allowing for a strategic behavior. In some cases, the blockholder voluntarily renounces to use...

The problem of managerial agency costs dominates debates in corporate law. Many leading scholars advocate reforms that would reduce agency costs by forcing firms to allocate more control to shareholders. Such proposals disregard the costs that shareholders avoid by delegating control to managers...