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Insider control by large investor groups and managerial disciplining in listed Belgian companies

Insider control by large investor groups and managerial disciplining in listed Belgian companies Defines corporate governance, describes the special characteristics of Belgian companies and presents a study of the disciplining of bad management in 165 companies listed on the Brussels stock exchange 1989‐1996. Finds that poor share price performance is generally linked to a higher turnover of directors except in holding companies and that several measures of poor accounting performance are linked to higher director and CEO turnover, although there is more resistance to this in large companies and less in those with a higher proportion of non‐executive directors or total/foreign ownership. Shows that negative after‐tax earnings lead owners with strong monitoring abilities (e.g. holding companies) to increase their stake while others (e.g. families and institutional shareholders) reduce it; and that CEO replacement is followed by increased dividends. Summarizes the findings, noting the differences between the finance sector and others. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Managerial Finance Emerald Publishing

Insider control by large investor groups and managerial disciplining in listed Belgian companies

Managerial Finance , Volume 26 (10): 20 – Oct 1, 2000

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References (19)

Publisher
Emerald Publishing
Copyright
Copyright © 2000 MCB UP Ltd. All rights reserved.
ISSN
0307-4358
DOI
10.1108/03074350010766918
Publisher site
See Article on Publisher Site

Abstract

Defines corporate governance, describes the special characteristics of Belgian companies and presents a study of the disciplining of bad management in 165 companies listed on the Brussels stock exchange 1989‐1996. Finds that poor share price performance is generally linked to a higher turnover of directors except in holding companies and that several measures of poor accounting performance are linked to higher director and CEO turnover, although there is more resistance to this in large companies and less in those with a higher proportion of non‐executive directors or total/foreign ownership. Shows that negative after‐tax earnings lead owners with strong monitoring abilities (e.g. holding companies) to increase their stake while others (e.g. families and institutional shareholders) reduce it; and that CEO replacement is followed by increased dividends. Summarizes the findings, noting the differences between the finance sector and others.

Journal

Managerial FinanceEmerald Publishing

Published: Oct 1, 2000

Keywords: Accounting research; Corporate governance; Top management; Corporate ownership; Directors; Belgium

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