公司治理結構與價值分析(ppt 76頁)（英文版）

公司治理結構與價值分析內容提要：
Recent corporate governance problems in the U.S.
Manipulations of accounting earnings
Enron, Global Crossing, Xerox, Adelphia Communications, World Com, Tyco International, ImClone Systems, Arthur Anderson, Freddie Mac, Microsoft
Off-Balance Sheet borrowings
Enron, Elan
Motivation: Smooth earnings, jack up stock prices (stock options)
Consequences
Firms involved went to bankruptcy or were in trouble
Whole market dropped due to investors’ loss of confidence
Remedies
Strengthen the regulations by SEC and the U.S. Congress
Internal and external auditing
More efficient boards of directors
Characteristics of Asian Companies
Owned and controlled by family (pyramid or crossholding)
Enhancement (interests of managers and shareholders can be more aligned)
Entrenchment (stealing, tunneling, ignoring or destroying firm value)
Lack of corporate governance (TSMC CEO: Integrity)
Cannot trust outside professional managers
Don’t know how to delegate
Pass CEO position to own son rather than capable manager
Commit to more cognitive or heuristic bias
Why is corporate governance important?
A recent survey conducted by McKinsey & Co. shows investors pay
a premium of more than 20% for good CG firms.
The benefits of good corporate governance:
reduce the cost of capital (WACC)
increase the value of the firms
benefit shareholders, employees, and society
Chen, Chen, and Wei (2003) find companies in East Asia:
non-disclosure CG improves from bottom 25% to top 75%: the cost of equity capital is reduced 1.26% points
Disclosure improves by the same magnitude, the cost of equity capital is reduced by 0.47% point
Firms in better CG country can also reduce the cost of capital
Simons (HBR, September 2002)
profitability is positively correlated with how workers perceive their managers' behavioral integrity (hotel industry)
What is corporate governance?
The mechanisms of
Pushing firms to operate more efficiently and to create value, and
Preventing potential exploitation of outside investors, particularly shareholders, by corporate insiders such as the management
Shareholders have control rights
Directors and managers are supposed to run the firms in the interests of the shareholders.
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