Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal最新文献

{"title":"Litigation Funding: An Economic Analysis","authors":"J. B. Heaton","doi":"10.2139/ssrn.3105702","DOIUrl":"https://doi.org/10.2139/ssrn.3105702","url":null,"abstract":"Basic economic analysis of litigation funding shows that risk neutral plaintiffs without budget constraints will not accept funding unless they are pessimistic relative to the funder. Risk aversion makes a plaintiff who shares probabilistic beliefs with the funder act observationally equivalent to a pessimistic, risk neutral plaintiff, so she will accept funding as well. An important benefit of litigation funding - evident from the application of a change of measure to risk neutral probabilities, an analytical approach widely used in the pricing of financial derivatives - is that it moves litigation outcomes closer to risk neutral outcomes and therefore closer to actions consistent with the plaintiff's perceived \"merits,\" something that is of underemphasized importance in law and procedure. The best funding outcomes (for investors) are likely when plaintiffs are risk averse or budget constrained. Poor outcomes are more likely when funded plaintiffs are risk neutral and unconstrained.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"10 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-01-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121529461","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Rethinking the Philippine Financial Market Regulatory Model for Market-Based Credit Intermediation","authors":"Michelle Dy","doi":"10.2139/ssrn.3059443","DOIUrl":"https://doi.org/10.2139/ssrn.3059443","url":null,"abstract":"The Philippines was one of the first countries in Asia to embark on a series of reforms which targeted capital market development and financial liberalization in the 1980s. It was very much on its way towards international financial integration when the 1997 Asian Financial Crisis (AFC) tempered this development. As a consequence, commercial banking assets still account for a majority of the total financial assets in the Philippines and traditional bank lending remains the primary mode of financing. However, change is coming. \u0000Estimation reveals that the country needs approximately US$110 billion to cover its infrastructure needs between 2013 and 2020. While the public sector can still be counted on to provide a lion’s share of this funding need, a tight fiscal space prevents it from solely fulfilling the investment target. As stricter banking regulations have raised the cost of borrowing and shrunk availability of capital in some cases due to borrower limits, the urgency brought by this infrastructure financing gap has given rise to calls to shift towards market-based credit intermediation. However, as local banks move into this space as a result of government reforms, new risks could possibly arise which the present framework of the institutional separation between banks and securities regulation might be ill-equipped to deal with. \u0000The purpose of this paper is to assess the capacity of Philippine financial regulators to cope with new risks as the country shifts from bank-based credit intermediation to a market-based one. Specifically, this paper shall attempt to answer whether the traditional separation between banking and securities regulation will still work under a changing financial landscape or whether there will be a need to shift towards a goal-oriented or functional model of financial regulation? This problem is not only relevant in the Philippine context but is also important for other developing countries which are attempting similar reforms.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"112 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-09-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133261240","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Fixing the Core, Earnings Management, and Sustainable Emergence from Financial Distress: Evidence from China’s Special Treatment System","authors":"Jiao Jing, K. Leung, Jeffrey Ng, Janus Jian Zhang","doi":"10.1177/0148558x211051169","DOIUrl":"https://doi.org/10.1177/0148558x211051169","url":null,"abstract":"Throughout their business life cycle, firms may experience financial distress. Successful emergence from such distress is important to their multiple stakeholders. Using a sample of publicly listed firms in China that emerged from Special Treatment (an indicator of delisting risk), we focus on the key actions such firms take prior to emergence, namely, fixing the core of the business and earnings management. We examine how these actions are associated with sustainable emergence, which we define as emergence from Special Treatment without reentry in the next 5 years. Consistent with the expectation that shortcut fixes to problems do not yield a long-term solution, we find that repairing the core of the business by improving operating efficiency is positively associated with sustainable emergence, whereas earnings management is negatively associated with it. We also find that the positive (negative) association between fixing the core (earnings management) and sustainable emergence is pronounced only for state-owned enterprises. Our article adds to the limited literature that examines issues related to distressed firms’ sustainable turnaround.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"2 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-05-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121781740","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Whistleblowers and Outcomes of Financial Misrepresentation Enforcement Actions","authors":"Andrew C. Call, Gerald S. Martin, Nathan Y. Sharp, Jaron H. Wilde","doi":"10.2139/SSRN.2506418","DOIUrl":"https://doi.org/10.2139/SSRN.2506418","url":null,"abstract":"Whistleblowers are ostensibly a valuable resource to regulators investigating securities violations, but whether there is a link between whistleblower involvement and the outcomes of enforcement actions is unclear. Using a data set of employee whistleblowing allegations obtained from the U.S. government and the universe of enforcement actions for financial misrepresentation, we find that whistleblower involvement is associated with higher monetary penalties for targeted firms and employees and with longer prison sentences for culpable executives. We also find that regulators more quickly begin enforcement proceedings when whistleblowers are involved. Our findings suggest that whistleblowers are a valuable source of information for regulators who investigate and prosecute financial misrepresentation.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"24 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-04-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123553095","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Why Delaware Must Retain its Corporate Dominance and Why it May Not","authors":"Charles m. Elson","doi":"10.2139/SSRN.2938704","DOIUrl":"https://doi.org/10.2139/SSRN.2938704","url":null,"abstract":"Delaware’s preeminent role in corporate regulation has endured for several important reasons. Most importantly, the state’s entire approach to the corporate law has been centered on investor protection. Although, through the years the ways by which it has tried to achieve this protection have changed, it is this animating principle that defines its laws. Investors are keenly aware of this fact and seek and respect the approach. Delaware’s primary industry is corporate regulation and to maintain its franchise, it must carry out its responsibilities fairly, intelligently and responsibly. Its corporate code is the most advanced in the country. Its judiciary has unusual expertise in the field and is highly respected in the resolution of corporate disputes. In recent years, it has maintained a delicate balance between upholding shareholder power and board prerogative. It is favored as the nation’s best forum for corporate dispute resolution by both investors and managers. It possesses a powerful franchise that would be difficult for other states to reproduce both judicially and, because of the influence in other jurisdictions of local corporate interests, practically. However, Delaware’s dominance is not assured and several recent developments may ultimately reduce its power and influence. First, while the chances of enactment of a federal corporate code are slim, federal intrusion into corporate governance regulation through the Sarbanes-Oxley and Dodd-Frank Acts has been harmful to the state. A significant portion of Delaware’s influence in areas such as audit oversight and executive compensation has been superseded by federal regulation. The benefit of a Delaware court’s resolution of these types of issues is therefore diminished and the attractiveness of simply incorporating in a company’s home state at lesser cost is increased significantly. If one incorporates in Delaware for a sensible regulation of corporate issues and that regulation has shifted to the federal regime, there is little point in incorporating in Delaware. Any increased federal intervention in this area only heightens the potential for this shift. The argument for federal regulation has revolved around creating a progressive national regulatory standard. But because local federal district courts, with little corporate expertise and local corporate political pressures, will ultimately decide regulatory disputes, this may lead to the balkanization of corporate law. Delaware, oddly enough, offers a coherent national approach. Still today, Delaware regulates much corporate conduct and a shift to other states is far off, but not inconceivable. \u0000The second major threat to Delaware’s dominance may be self-inflicted. For years the process by which Delaware courts are constituted and corporate law made has been considered above partisan politics and local interests. Any action that compromises its courts or the corporate law process due to local political considerations may diminish the s","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-03-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123681821","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Evolutionary Models of Corporate Law","authors":"Amitai Aviram","doi":"10.2139/ssrn.2898413","DOIUrl":"https://doi.org/10.2139/ssrn.2898413","url":null,"abstract":"This chapter first considers resistance to the use of theoretical models, examining tensions between the goals and methodologies of historians and economists who investigate differences in law over time (legal history) or between jurisdictions (comparative law). It then proceeds to define the characteristics of evolutionary models: a family of theoretical models that (in the author’s opinion) are particularly fruitful in exploring changes in law over time. The rest of the chapter examines regulatory competition, an area in which scholarly debate has focused on rival evolutionary models (though the models were not usually described and analyzed as such). Three models – horizontal (state vs. state), vertical (federal vs. state) and intrastate (interest group vs. interest group) – are explored and critiqued.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"345 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-01-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132740304","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The 'Long Term' in Corporate Law","authors":"J. B. Heaton","doi":"10.2139/SSRN.2864906","DOIUrl":"https://doi.org/10.2139/SSRN.2864906","url":null,"abstract":"To read influential corporate lawyers, legal academics, and jurists, shareholders are an alarmingly myopic bunch who demand that corporate directors and managers make short-term decisions that sacrifice long-term value. But here is the mystery: there is virtually no evidence that shareholders prefer short-term gains that are smaller than larger (discounted) long-term gains. I make a simple claim in this Essay: the short term/long term rhetoric in Delaware corporate law masks the real battle, one between a rational desire by clear-sighted shareholders for shareholder value maximization, on the one hand, and a desire by courts and others for corporate longevity – i.e., long-term corporate survival – on the other. Corporate law directs, or at least allows, directors to manage for long-term survival, i.e., a state of sufficient ongoing profitability that allows the corporation to exist for as long as possible, regardless whether or not that level of profitability is value-maximizing for shareholders.The problem this raises is obvious: if Delaware allows corporations to prioritize longevity, then that is a goal often at odds with what shareholders want. Whether this policy is good or bad for society, I leave for another day. But so long as Delaware leaves the power of the vote with shareholders while giving directors a hidden power to act against their interests in the name of corporate longevity, we can expect shareholder objections and activist efforts in many cases where corporations are worth more in different form, whether differently oriented, smaller, acquired and merged into larger organizations, or, to put it harshly, liquidated and dead altogether.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-01-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130283384","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Venture Capital Divide: Germany and the United States in the Post-War Era","authors":"Caroline M. Fohlin","doi":"10.2139/ssrn.2849237","DOIUrl":"https://doi.org/10.2139/ssrn.2849237","url":null,"abstract":"This paper analyzes and explains the disparate paths of development among venture capital organizations in the United States and Germany over the post-World War II period, contrasting the early emergence and burgeoning of the sector in the U.S. with the lagging development in Germany. The paucity of venture capital in Germany throughout the latter half of the 20th century is often seen as a result of that country's system of large, powerful universal banks and small, inactive capital markets. Lack of acceptance may additionally appear to result from cultural or social differences that make Germans suspicious or skeptical of such risk-taking and disdainful of the capitalistic drive it represents. I argue instead that a complex of political, social, and economic factors - many dating back to institutions put into place in the 19th century - explains the evolution of venture capital over the post-war era. These factors differed radically between the U.S. and Germany and produced divergent outcomes for venture capital institutions a century later. I emphasize the crucial role of the available pool of qualified, potential entrepreneurs and the incentives that either drove or hindered high-technology venturing, particularly during the middle of the twentieth century.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"403 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133006226","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"We Have a Consensus on Fraud on the Market -- And It's Wrong","authors":"J. Spindler","doi":"10.2139/ssrn.2781578","DOIUrl":"https://doi.org/10.2139/ssrn.2781578","url":null,"abstract":"Recent scholarship overwhelmingly contends that the fraud on the market securities class action has neither deterrent nor compensatory effect and should be cut back or even abandoned entirely. This scholarship largely focuses on two critiques: circularity, which holds that shareholder class action claimants are suing themselves, making compensation impossible; and diversification, which holds that fraud constitutes a diversifiable risk, such that diversified shareholders both gain and lose from fraud in equal measure and hence are not negatively impacted. These critiques are arguably the most important and widely-used theoretical development of the last two decades in securities law, and enjoy a broad consensus. Unfortunately, these critiques are wrong. After tracing the evolution of these critiques, this paper demonstrates economically that, despite widespread acceptance, none of the principal claims of these critiques are correct. In particular: fraud on the market does indeed compensate defrauded purchasers despite circularity (under certain conditions, perfectly); and diversified investors do have expected losses from fraud and have incentives to undertake deadweight precaution costs. Further, the fraud on the market remedy deters both precaution costs and, under certain conditions, fraud itself. The critiques are fundamentally flawed, the academic consensus on fraud on the market is incorrect, and the panoply of reform proposals based on these critiques is without foundation. These critiques have fueled a trend of cutbacks and ongoing existential challenges to fraud on the market (as in Halliburton) that, in light of these results, should be rethought.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"13 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-06-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129567081","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Short-Form Disclosure Documents ― An Empirical Survey of Six Jurisdictions","authors":"Andrew Godwin, I. Ramsay","doi":"10.1093/CMLJ/KMW002","DOIUrl":"https://doi.org/10.1093/CMLJ/KMW002","url":null,"abstract":"Recent years have seen a trend in many countries towards the adoption of short-form disclosure documents for the sale of financial products (ie, disclosure documents in respect of which the maximum page length is prescribed, either on a mandatory or recommended basis). This trend has been driven by a number of factors, including recognition of the limitations of the conventional approach to disclosure in explaining content in terms that investors can understand (despite the use of plain English or plain language techniques), challenges arising out of the increasing complexity of financial products and also the results of investor research demonstrating that retail investors are not likely to read lengthy disclosure documents.This article reports on the findings from an investor survey undertaken to gain insights into the readability and relative strengths and weaknesses of short-form disclosure documents as adopted in six jurisdictions: Australia, Canada, the European Union, Hong Kong, New Zealand and Singapore. A number of important findings emerge from the survey. Significantly, the disclosure document that was based on the approach in Canada was overwhelmingly considered to be the easiest to read, whereas the disclosure document that was based on the approach in Australia was overwhelmingly considered to be the hardest to read. In terms of which was the easiest document to understand, neither demographics nor financial literacy had any impact on this decision, and the five most influential factors were ranked as follows: (1) language that was easy to understand; (2) clear explanation of the key features; (3) appropriate format; (4) appropriate length; and (5) clear explanation of the investment risks. Other findings include the effectiveness of synthetic risk indicators and the extent to which investors invest solely on the basis of a disclosure document.","PeriodicalId":286147,"journal":{"name":"Corporate Law: Corporate & Financial Law: Interdisciplinary Approaches eJournal","volume":"46 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-05-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116083470","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}