RT Journal Article
T1 Strong shareholders, weak outside investors
A1 Gutiérrez, María
A1 Sáez Lacave, María Isabel
A1 Gutierrez Calderon, Maria Isabel
AB We consider the corporate governance challenge of protecting outside investors in listed, controlled firms. We argue that outside investors in European listed firms with controlling shareholders are poorly protected compared to US investors because the distinct European approach to the protection of investors, based on empowering active shareholders rather than shielding passive investors, is not well suited for controlled, listed firms. This approach translates into a lack of definition and development of specific fiduciary duties of the controlling shareholders towards market investors. Moreover, European jurisdictions have developed strong voice rights for active shareholders, which tend to play in favour of controlling shareholders and organised minorities but are not effective for protecting passive investors and limit their exit options. This explains why shareholder protection in European jurisdictions can be considered high, while outside investors’ protection can be considered low at the same time, generating a ‘strong shareholders, weak outside investors’ problem.
PB Taylor & Francis
SN 1473-5970
YR 2018
FD 2018-02-02
LK https://hdl.handle.net/10016/35477
UL https://hdl.handle.net/10016/35477
LA eng
NO María Gutiérrez acknowledges financial support from FEDER [UNC315-EE-3636], MINECO/FEDER [ECO2015-68715-R] and MINECO [ECO2012-36559]. Maribel Sáez Lacave acknowledges financial support from MINECO [DER 2014-55416-P].
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