|
Corporate
Governance in Germany - The Role of Banks and Ownership of Concentration
German banks do not play a
distinctively different corporate governance role from that played by
other large shareholders in German industry. High ownership
concentration is more important. This new finding appears in a paper by
Jeremy Edwards and Marcus Nibler of Cambridge University. Their work
appears in the latest edition of Economic
Policy published by three major European economic research
organisations. The authors find that although banks may influence
corporate governance via their control of proxy votes, positions on
supervisory boards, and provision of loan finance, in practice they do
not play a role in the governance of large German firms which is
distinct from that of other types of large shareholder. One unexpected
finding is that German firms make little use of bank loan finance. Any
superiority of German corporate governance of large firms must therefore
be based on high ownership concentration rather than a special role of
banks, and must consider the costs of ownership concentration as well as
the benefits. The study concludes that ‘the effects of high ownership
concentration are not unambiguously positive.’
Notes for Editors:
Economic Policy is published in Association with the European
Economic Association by the Centre for Economic Policy Research, the
Centre for Economic Studies of the University of Munich and the Département
et Laboratoire d’Economie Théorique et Appliquée (DELTA), in
collaboration with the Maison des Sciences de l’Homme.
For
further information about CEPR, please contact Rita Gilbert, Tel: (44 20) 7878
2917 / Mobile: 07941 196 806 or email: rgilbert@cepr.org, or
contact James Morgan, Tel: (44 20) 8225 7262. Visit our website for a
copy of this document or for additional services: http://www.cepr.org.
The Authors:
Jeremy Edwards is
in the Department of Economics and Politics at the University of
Cambridge and Marcus Nibler is at the University of Cambridge.
Economic
Policy
Issue 31
Including
Jeremy
Edwards and Marcus Nibler
Corporate Governance in Germany: the Role of Banks and Ownership
Concentration
Available
from
Blackwell
Publishers Journals, PO Box 805, 108 Cowley Road,
Oxford OX4 1FH, UK.
Tel: (44 1865) 244083 Fax: (44 1865) 381 381
jnlinfo@blackwellpublishers.co.uk
www.blackwellpublishers.co.uk
|