Tunneling

Pyramidal Discounts: Tunneling or Overinvestment?

Optimally Restrained Tunneling: The Puzzle of Controlling Shareholders’ “Generous” Exploitation in Bad-Law Jurisdictions

Although controlling shareholder agency problems have been well studied so far, many questions still remain unanswered. In particular, an important...

Executive Compensation: When a Firm is a Business Group Member

This paper examines how executive pay is set when a firm is a business group member. Using Korea as a laboratory setting, we find that member firm?s cash...

Restricting CEO Pay Backfires: Evidence from China

Using the pay restriction imposed on CEOs of centrally administered state-owned enterprises (CSOEs) in China in 2009, we study the effects of limiting...

Cheap-Stock Tunneling Around Preemptive Rights

Preemptive rights are thought to protect minority shareholders from cheap-stock tunneling by a controlling shareholder. We show that preemptive...

Regulation and self-regulation of related party transactions in Italy: An empirical analysis

This paper assesses how Italian companies have implemented the regulation on related party transactions enacted by Consob in 2010. Companies have been...

Tunneling Through Group Trademarks

This study documents how group trademarks, comprising the business group’s name and logo, can be used for the benefit of controlling families at the...

Law and Tunneling

Insiders (managers and controlling shareholders) can extract (tunnel) wealth from firms using a variety of methods. This article examines the...

The Effect of Minority Veto Rights on Controller Pay Tunneling

A central challenge in the regulation of controlled firms is curbing rent extraction by controllers. As independent directors and fiduciary duties are...

How Does Law Affect Finance? An Examination of Equity Tunneling in Bulgaria

We model and test the mechanisms through which securities law affects tunneling and tunneling affects firm valuation. In 2002, Bulgaria adopted...

The Law and (Some) Finance of Related Party Transactions: An Introduction

This paper is the introductory chapter of Luca Enriques and Tobias Tröger (eds.), The Law and Finance of Related Party Transactions (Cambridge...

Related Party Transactions: Policy Options and Real-World Challenges (With a Critique of the European Commission Proposal)

This paper provides a legal and policy analysis of transactions between a corporation and one of its ?related parties.? It first highlights the reasons...