• explain different concepts of corporate governance
• understand the concept of agency cost and analyze how agency issues are related to particular governance system
• analyze the opportunities and the barriers for non controlling agents to affect the organization of governance in firms, including the role of active individual shareholders, institutional investors and others
• Identify the opportunities and potential pitfalls in use of incentive based remuneration as a tool to motivate managers
• analyze how corporate governance of a particular company influences its performance
• analyze the role of different stakeholders: managers, employees, investors, creditors, suppliers, customers, competitors, local and central government, etc.
• understand the role of managers, boards, shareholders, general meetings
• learn to appreciate how the governance, behavior and performance of individual companies are shaped by the governance system in which they operate
• analyze how different governance mechanisms solve/limit the governance problems;
• identify different models of corporate governance in different countries
• understand the differences in the corporate governance mechanisms across the world, the elements of governance codes and gain the ability to apply these recommendations within the context of individual firms
• understand the role of Corporate Social Responsibility

The current financial crisis has raised important questions concerning the control and responsibility of the owners and the managers especially in banks and large corporations. Many of these questions are closely related to the discussion about good corporate governance - understood as the system by which companies are directed and controlled.

The course starts with a discussion about the problems and advantages of the large-scale organization. We continue by looking at institutional investors, which has become crucial players in the financial market following shifts of ownership structure. Thereafter we look at minority shareholders, minority protection, and the regulation of capital. We then go on a classroom journey around the world, exploring region- and country specific governance systems and solutions, the regulation of labour, transplant of corporate law, and political preconditions for separating ownership and control. We start by visiting developed nations, and end the course by exploring markets in transition.

A package of academic articles and bookchapters, divided by each lecture’s content.

Indicative literature:

Becht, Bolton and Röell (2002): Corporate Governance and Control,

European Corporate Governance Institute, Financial Working Paper no. 02

Copenhagen Stock Exchange (2003): “The Report on Corporate Governance in Denmark”, www.corporategovernance.dk

Denis D.K. and J.J. McConnell: 2003 International Corporate Governance:

Journal of Financial and Quantitative Analysis, vol 36, no 1, March.

La Porta et al. (1998), Law and finance, Journal of Political Economy, 106, pp. 1113-1154

La Porta et al. (2000), Investor protection and corporate governance, Journal of Financial Economics, 58, pp 3-27

Nadler D.A.(2004): Building Better Boards, Harvard Business Review, May 2004,p102-111

Pettit, Justin (1998) “Governing for value”, Ivey Business Quarterly, Autumn 63, 1.

Rose, Caspar: Stakeholder versus shareholder value – a matter of contractual failures, (2004), European Journal of Law and Economics, 18, pp.77-97

Shleifer A. and R. W. Vishny (1997): A Survey of Corporate Governance,

The Journal of Finance, vol LII, no 2, June, pp. 737-783.

Thomsen, Steen: An Introduction to Corporate Governance – Mechanisms and Systems. DJØFs forlag, 2008

Tirole, Jean. (2006) Corporate Governance. Chapter 1 in The Theory of Corporate Finance. Princeton University Press. 2006.

Weimer J. and J. C. Pape: A Taxonomy of Systems of Corporate Governance,

Corporate Governance, Vol 7, no 2, April 1999.