International Corporate Governance: The 5 Best Governance Strategies

In international corporate governance, low investor protection allows shareholders to extract larger benefits of control. In Denmark, the private benefits extracts by controlling shareholders are zero while in Mexico it is 50%. The rest of the world falls in between. There can be transfers of profits and assets out for firms to benefit the controllers; an effect known as tunneling.

International Corporate Governance

This effect is much likely in civil law countries than in common law countries. It would be prevalent in firms where pyramid ownership structures lead to excess control rights.

corporate governance
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