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The Deconstruction of Equity: Activist Shareholders, Decoupled Risk, and Corporate Governance

The Deconstruction of Equity: Activist Shareholders, Decoupled Risk, and Corporate Governance

  • Author:
  • Publisher: Oxford University Press
  • ISBN: 9780198723035
  • Published In: April 2016
  • Format: Hardback
  • Jurisdiction: U.K. ? Disclaimer:
    Countri(es) stated herein are used as reference only

List Price: HKD 1,462.50

HKD 1,418.63 Save HKD 43.87 (3%)

Delivery Time: around 4 weeks
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  • Description 
  • Contents 

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New investment techniques and new types of shareholder activists are shaking up the traditional ways of equity investment that informs much of our present-day corporate law and governance. Savvy investors such as hedge funds are using financial derivatives, securities lending transactions, and related concepts to decouple the financial risk from shares. This leads to a distortion of incentives and has potentially severe consequences for the functioning of corporate governance and of capital markets overall. Taking stock of the different decoupling strategies that have become known over the past several years, this book then provides an evaluation of each from a legal and an economic perspective.

Based on several analytical frameworks, the author identifies the elements of equity deconstruction and demonstrates the consequences for shareholders, outside investors, and capital markets. On this basis, the book makes the case for regulatory intervention, based on three different pillars and comprising disclosure, voting right suspension, and ex-post litigation.

The book concludes by developing a concrete, comprehensive proposal on how to address the regulatory problem. Overall, this book contributes to the debate about activist investment and the role of shareholders in corporate governance. At the same time it raises a number of important considerations about the role of equity investment more generally.

1: Introduction
2: Shareholders in Corporate Governance
3: Risk-Decoupling Strategies
4: The Failure of Traditional Categories of Law
5: Problem Perspectives
6: Solutions
7: The Federal Dimension
8: Conclusion

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