战略管理(第十三章).ppt

1、Chapter 13Corporate Governance in the Twenty-First Century,1,OBJECTIVES,Explain what is meant by corporate governance,1,Describe how corporate governance relates to competitive advantage and understand its basic principles and practices,2,Identify the roles of owners and different types of ownership

2、 profiles in corporate governance,3,Describe how boards of directors are structured and the roles they play in corporate governance,4,Explain and design executive incentives as a corporate governance device,5,Describe how the market for corporate control is related to corporate governance,6,Compare

3、and contrast corporate governance practices around the world,7,2,SUNBEAM,Al Dunlaps mgmt. philosophy,Shareholders are most important corporate constituents Most corporations have bloated bureaucracies Drastic layoffs are usually neededto save failing companies Layoffs should be quick,one-time events

4、 CEOs should be rewarded likestars when they perform welland fired when they do not Board members should have significant personal investmentsin the company,3,CORPORATE GOVERNANCE,In a broader perspective, governance determines how all stakeholders influence the corporation:,4,CORPORATE GOVERNANCE I

5、MPACTS PERFORMANCE,The Italian stock exchange started a new exchange called STAR for small and mid-sized companies that followed strict governance prescriptions,Companies of the STAR exchange consistently out perform their counterparts on the regular exchange (e.g., during 2004 STAR firms achieved r

6、eturns 24.5% greater than their counter parts),5,EARLY WARNING SIGNS OF PROBLEMS WITH KRISPY KREME,Source: M. Maremont and R. Brooks, “Fresh Woes Batter Krispy Kreme; Doughnut Firm to Restate Results, Delay SEC Filing; Shares Take a 15% Tumble,” Wall Street Journal (Eastern edition), January 5,2005.

7、p.A3,6,AGENTS AND PRINCIPALS,When interests are virtually identical, the agency problem is small: executives do what is in principals best interests However interests often do not overlap. Then agents may act to detriment of principals and visa-versa (e.g., executives raise salaries and reduce retur

8、ns),7,EXAMPLES OF CODES OF GOVERNANCE,Country,United Kingdom Cadbury Code1,Singapore CG Committee (2001),Russia CG Code (2002),Brazil CVM Code (2002),United States Conference Board and CalPers (2003)2,Can the same executive be both CEO changing audit firm after 10 years of continual relationship or

9、if former audit partner is employed by the company,8,SOME NEW COMPLIANCE RULES FROM SARBANES-OXLEY,Auditors must list the non-audit services they are unable to perform during an audit A one-year waiting period for audit-firm employees who leave an accounting firm to become an executive for a former

10、client Transactions and relationships that are off the balance sheet but that may affect financial status must now be disclosed Personal loans from a corporation to its executives are now largely prohibited Research analysts for securities firms must now file conflict of interest disclosures. For in

11、stance, analysts must report whether they hold any securities in a company or have received corporate compensation Brokers and dealers must disclose if the public company is a client Altering, destroying, concealing, or falsifying records or documents with the intent to influence a federal investiga

12、tion or bankruptcy case is subject to fines and up to 20 years of imprisonment,9,OWNERSHIP STRUCTURE VARIES,Source: Company annual reports,10,ROLES AND ACTIONS OF BOARD OF DIRECTORS,11,EFFECTS OF CEO FIRINGS,Source: M.wiersema, “Holes at the Top: Why CEO Firings Backfire,” Harvard Business Review 80

13、;12 (2002), 70-77,12,INCENTIVE ALIGNMENT,13,HOW WOULD YOU DO THAT? DENDRITE INTERNATIONAL,Dendrites challenge:,Dendrites solution:,How can Dendrite better align managementincentives with shareholders?,20 senior-most executives must own 15,000 to 100,000 shares of stock Must be common sharesnot optio

14、ns Must be achieved within 5 years Executives may elect to receive incentive compensation in stock instead of cash,14,EXECUTIVE STOCK OWNERSHIP IN 2004,Largest 250 companies withstock ownership guidelines,Executives,Directors,Number ofcompanies,142,123,Percent ofcompanies,57,49,Percent increase from

15、 2001 to 2004,58,127,Source: Adapted from Fredrick W. Cook & Co., Inc., “Stock Ownership Policies: Prevalence and design of Executive and Director Ownership Policies Among the Top 250 Companies,” (accessed Nov 29, 2005), Sep 2004,15,INCENTIVE COMPENSATION,16,CEO PAY COMPARISON,17,HIGHEST PAID CEOs,S

16、ource: Company annual reports and ExecComp Service of Thomson Financial,18,EXECUTIVE PAY TRENDS,Source: U.S. Bureau of Labor Statistics,19,THE MARKET FOR CORPORATE CONTROL,20,POOR CORPORATE GOVERNANCE, A WORLD-WIDE PROBLEM,Recent examples of scandal-ridden non-U.S. multinationals,Netherlands Ahold G

17、roup (grocery stores),Italys Parmalat (dairy and food products),Frances Vivendi (entertainment),French-Belgian Firm ELF (petroleum),21,CORPORATE GOVERNANCE: U.S VS. JAPAN,Owner-managerrelationship,Manager andshareholderrelationship,Ownershipconcentration,U.S,Adversarial,Through onecompany,Control fu

18、nction,Japan,Co-operative,Through a Keiretsu (group of interlockingcompanies),Monitoring function,22,CORPORATE GOVERNANCE IN GERMANY AND CHINA,23,HOW WOULD YOU DO THAT? CHIQUITA,How should Chiquita compensate its new CEO?,Source: Company annual reports,24,SUMMARY,Explain what is meant by corporate governance,1,Describe how corporate governance relates to competitive advantage and understand its basic principles and practices,2,Identify the roles of owners and different types of ownership profiles in corporate governance,3,Describe how boards of directo