Corporate Governance

Course Description:

Corporate governance deals with the complex set of relationships between the corporation and its board of directors, management, shareholders, and other stakeholders. In the recent years, the regulators and legislators have intensified their focus on how businesses are being run. They are trying to create a template for new corporate governance practices and disclosure measures, which are beneficial for both the stakeholders and controllers.

Learning Outcomes:

  • Comprehend various models and mechanisms of corporate governance
  • Value the shareholder and stakeholder rights and responsibilities
  • Adopt the appropriate mechanism for effective governance
  • Adhere to sound principles of direction and management
  • Understand the significance of audit committee, its composition and responsibilities
  • Implement best practices on corporate management
  • Analyze the corporate scandals along with corporate best practices

Literature

Text Book
#               Title Author(s) Assigned Code
1 A blueprint for Corporate Governance Fred R. Kaen KF
  Corporate Governance John L Colley et al. CJ

Discussion Plan

Week Topics Assigned code
1-2 –          An overview of the course, its requirements and expectations

–          Introduction to the Corporate Governance, its definitions and importance

–          The Modern Corporation , Civic Republicanism and Liberalism

–          The Separation of Ownership and Management (The Agency Relationship)

–          The Managerial Capitalism, Technocracy and Contractual Shareholder Model

 

KF
3-4 –          The Board of Directors and Shareholders Rights

–          Board Committees, Compensation Plans

–          Board Governance and Firm Performance

 

KF
5-6 –          Alternative Governance Systems (Germany and Japan)

–          The German System and Japanese Keiretsu

–          Governance Structures of American Corporations

–          Owners, Voting Rights, Board of Directors, Corporate Executives and Senior Managers, Creditors etc

 

KF
7 –          Financial Markets and their Efficiency

–          Weak, Semi-Strong and Strong Form Efficiency

–          Market Inefficiencies and Anamolies

 

KF
8 –          Valuation of Common Stock and Investor’s Required Rate of Return (Capital Asset Pricing Model (CAPM) KF
   

                                 Mid Term Exam

 
9 –          Corporate Governance Issues in Investment Decisions (The NPV Rule)

 

KF
10 –          Corporate Governance Issues in Financing Decisions (Shareholders, Managers and Creditors Conflict of Interest)

 

KF
11 –          Corporate Governance and Dividend Issues (Information Asymmetry Problems)

 

KF
12-13 –          Corporate Governance and Managerial Compensation (Short- Term and Long-Term Compensation Plans)

 

KF
14-15 –          The Corporate Control Market (Mergers, Acquistions, LBO’s)

 

KF
16 –          The Case of Enron

 

KF
  Final Exam

 

 

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