This paper measures corporate control benefits - the value that dominant vote-holders expropriate from a controlled company to the detriment of other shareholders. Control benefits are extracted from the total value of the votes in the control block, based on a baseline control contest model in...

Amidst a public outrage at grants of golden parachutes to failed executives, the award of "perpetual thrones" to directors of distressed companies has gone unnoticed. Several merger agreements provide for an undertaking by the acquirer to increase the size of its own board and include a few of...

Under German law, the subscribed capital of a company can either be paid up in cash or in kind. Contributions in kind are subject to special rules because they pose the danger of an overvaluation of assets which is detrimental to both the other members of the company and to its creditors. Thus,...

Corporate Governance relates to mechanisms through which providers of resources to the firm get their share of resources in return. Adequate governance practices help develop capital markets and assist market forces in attaining efficient contracts. Convincing evidence exists that well developed...

This paper examines how the quality of firm information disclosure affects shareholders' use of dividends to mitigate agency problems. Managerial compensation is linked to firm value. However, because the manager and shareholders are asymmetrically informed, the manager can manipulate the firm's...

In 2002, the SEC, citing a need for transparency, promulgated new disclosure rules pertaining to corporate stock repurchase programs. As a result, companies since 2004 have been required to provide monthly reports on the volume and pricing of their stock buybacks. Under the new reporting...

This paper seeks to draw attention to a flaw in the firm’s Free Cash Flow model and related statement widely accepted in Corporate Finance. We argue that the common offset of any Current Liabilities against Current Assets distorts the FCF size, composition, and volatility, thereby misstating...

Free Cash Flow (FCF) was adopted in the late 1980s as a financial tool to evaluate the firm and its individual projects. We question the procedure of calculating the FCF where a significant portion of Current Liabilities is offset against Current Assets, thereby creating the hybrid asset Net...

In the last three decades, corporate governance and reporting have been confronted to a drift toward shareholders' primacy and value, and the revival of old-fashioned proprietary views against entity views on the business firm. This paper develops an accounting perspective of the relationship...

In this paper we argue that information asymmetry between firm insiders and outside equity investors generates conservatism in financial statements. Conservatism reduces the manager's incentives and ability to manipulate accounting numbers and so reduces information asymmetry and the deadweight...