We employ a comprehensive measure of corporate governance that encompasses those governance mechanisms that have received the most attention in the academic literature, namely, board and chief executive officer (CEO) characteristics, compensation, insider ownership, transparency, and antitakeover measures
Rights agreements are popular antitakeover measures
, but the price at which the shareholder may purchase additional shares in the case of a takeover is usually set below or close to the market price.
to oppose its adoption of antitakeover measures
, reduced shares in five Japanese firms, while increasing equity in two firms.
Whether the topic is executive compensation, majority voting for directors, or antitakeover measures
, the influence of shareholders on corporate policymaking is definitely on the rise.
While the existing literature reports conflicting findings concerning the relationship between the inside/outside director dichotomy and the adoption of antitakeover measures
, consistent with agency theory we propose:
Alternatively, Comment and Schwert (1995) state that antitakeover measures
are unlikely to alter a firm's probability of being acquired and are not a significant tool for management to entrench and protect themselves.
The development of antitakeover measures
and poison pills could facilitate management entrenchment to avoid the fundamental improvements required.
Corporate governance proposals that are placed on the ballot by shareholders include issues related to the restoration of shareholder rights that have been previously taken away by the company, the adoption of proxy voting rules that are deemed to be more favorable to the shareholders, the repeal of certain antitakeover measures
and issues that relate to the election of the board of directors.
Generally speaking, some leading experts seem to agree that today's antitakeover measures
, particularly Section 203, severely limit unsolicited offers and some even question its constitutionality.
91 billion yen due to costs in adopting antitakeover measures
Evidence that pension plan sponsors are pressuring outside managers to approve antitakeover measures
that are contrary to the interests of beneficial owners, and that some managers have succumbed to these pressures, has become the focal point for broader Congressional concern about conflicts of interest.
Corporate-governance-related proposals received the strongest support, particularly those related to antitakeover measures
, board pensions, and shareholder voting.