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What Shapes Controlling Party’S Behavior?: Factors Behind Private Benefits Of Control, Federico Pastre
What Shapes Controlling Party’S Behavior?: Factors Behind Private Benefits Of Control, Federico Pastre
Federico Pastre
Several legal and non-legal factors determine and shape controlling party’s behavior and its ability of extracting private benefits of control through opportunistic conducts that harm minority shareholders.
Initially, the paper briefly focuses on the concept of PBC and on the ways its magnitude can be assessed. Starting from the quality of the laws enacted and the level of enforcement granted to them in a given law environment (“law matter” thesis), to other law-related factors such as the level of competition, the labor in the firm, reputational constraints upon management, disclosure standards and the attitude of the judiciary, the paper analyzes …
How Shareholder Litigations Deter Directors And Officers. U.S. And Italy, A Comparative Analysis, Federico Pastre
How Shareholder Litigations Deter Directors And Officers. U.S. And Italy, A Comparative Analysis, Federico Pastre
Federico Pastre
This paper focuses on the issue of whether shareholder litigations brought in the U.S. - namely, derivative suits and securities class actions – and their equivalent in the Italian law system, achieve their principal regulatory goal of deterring corporate directors and officers from engaging in unlawful conduct, in addition to compensating shareholders and investors for the harm they suffered.
In the U.S., effective derivative suits and securities class actions, contingency fees, and the rule concerning legal expenses, create an entrepreneurial system in which directors and officers are ultimately deterred by the private enforcement of the law. Nevertheless, the presence of …