Corporate governance is characterized by a system of relationships between shareholders and the company's management and a system of mechanisms through which shareholders can control the work of the company and the activities of its leader. There are several types of corporate models: the Anglo-American model (outsider), the German model (insider), Japanese and family.
The Anglo-American and German models are very different, at the same time, there are many similar models between them that have adopted certain features of the main ones. For example, in Germany and Austria, a purely German, undiluted form is used corporate governance, but in the Scandinavian countries, as in France, certain aspects of this model are used.
German control system
The German (or Germanic) management model is very similar to the Japanese one, which is why it is sometimes called Japanese-German. However, there are still certain differences between them. The founder of the German model of corporate governance is considered to be a sociologist, scientist and economist who lived at the beginning of the 20th century, Marx Weber. It soon became widespread in Germany, Austria, Switzerland and other Western countries, remaining relevant in our time.
Typically, the German management model is used in two cases:
- Low degree of development of the stock market.
- Concentration of share capital in the hands of various institutional investors and a small share of it in private investors.
Model structure
There are 3 levels of management structure in Germany.
- The highest governing body is the general meeting of shareholders. It is designed to address the following issues:
- election and dismissal of members of the management board and supervisory board,
- appointment of an auditor,
- development of various additions and changes to the company’s charter,
- determining the order of spending the total profit,
- Liquidation of company.
The frequency of shareholder meetings varies in each company, as it depends on the charter. In addition, the meeting can be held on the initiative of members of the management body or shareholders holding at least 5% of the shares. Before the meeting, an agenda is published, which outlines the issue and options for resolving it. Each shareholder during the day has the opportunity to propose his own version of the development of events. Decisions at the meeting are made by a majority vote, but come into force only after they have been notarized.
- The functions of the supervisory board include monitoring economic activity companies. It includes shareholders and employees of the company. In addition, the supervisory board may often include people with close relations with the company (employees of banks, other companies, etc.). The number of representatives depends on the size of the company. The minimum number of representatives of the supervisory board is at least 3 persons, however, according to German law, there should be much more.
The main task of the supervisory board is to select managers of the company and control their activities. Members of the supervisory board make decisions by a majority vote.
- The company's board is formed from managers. The responsibility of the board includes direct economic management of the company and responsibility for the results of this activity.
Typically, board members are appointed for a term of up to 5 years. It is prohibited for them to engage in any other commercial activity. Board decisions are made by consensus (when decisions are made in the absence of objections among the majority of those present).
The German (or Germanic) management model is characterized by the following features:
- Agreement between employees and management.
- Long-term cooperation.
- Financial systems in which the key link is the bank.
- Dominance of outsiders.
- Focus on other stakeholders.
- Stimulating professional training.
Vocational training (and its quality) is extremely important in Germany. Special attention devoted to technical and engineering training, which is considered one of the best in Europe. The education system provides the necessary educational preparation for young people aged 16 to 21 years.
70% of workers of various enterprises in Germany who have completed training and passed the qualification have vocational education. For comparison: such qualifications are observed in only 40% of workers in the Netherlands and 30% in England and the USA.
All workers and specialists in Germany are constantly faced with new technologies, adaptation to which is necessary for their further successful work, therefore stimulating the professional growth of employees plays a huge role. If there is desire and knowledge, there will be results.
Technical training for managers
General management training is not highly valued in Germany, but all German managers can rightly be considered professionals. Until the 80s, management was not considered at all as a separate, independent discipline, since the Germans were sure that such training would breed selfishness, disloyalty and disregard for product quality among employees, which is destructive for any company.
In the 1980s, two business schools specializing in management were created. But for German managers, a higher technical education or a doctorate in the scientific and educational classification is more typical.
Demanding attitude towards competence
Germans value discipline and self-control. Professionalism plays a critical role in culture.
Expanded scope of powers and responsibilities
When line personnel have sufficient qualifications and competence, they need less control from management. The Germans believe that staff do not need motivation from a manager at all - a manager is needed only to assign tasks and solve technical problems that arise during their implementation.
Loyalty from managers
Corporate loyalty is more widespread in Germany than, for example, in the USA, since here employees “stick” with the company much longer - more than 8 years. If for the British or Americans such experience seems detrimental to the company, then for the Germans this is a completely normal phenomenon, since experience makes it possible to achieve the required level of competence.
In Germany, the concept of shadow deputies is common. Such employees are trained by managers as their deputies, who can perform their duties in case of illness or other situations when circumstances do not allow the manager to go to work.
Innovation and quality
Basics competitive advantage German companies are the quality of their products, their timely delivery, installation and maintenance. Thanks to high income levels, German consumers can pay top dollar for decent quality.
Effective labor relations
Stable relationships between managers and their subordinates are the key to success for any German company.
Production management is formalized
The Germans give great importance detailed description of job functions and procedures. Therefore, at German enterprises there is a high degree of formalization in the form various instructions, instructions, rules. This trend is especially pronounced in large corporations.
The main differences between the German and American models
- The American management model is characterized by the dependence of shareholders on corporate managers. However, this also increases the role of the market for corporate control, through which control is exercised over managers of joint-stock communities. Managers generally play a big role in the United States.
- The German management model, on the contrary, is highly dependent on shareholders, who can unite into large communities with considerable weight, thus controlling management. But the Germans practically do not recognize management as an independent medicine.
- Lack of attention from minority shareholders.
- Insufficient information transparency of companies.
- A complex system of investor investments in companies, especially in comparison with the UK and the USA.
Disadvantages of the German corporate governance model
The German management model is quite effective, although, like any system, it has its drawbacks. The German management model is based on responsibility, qualifications and independence. Like the American model, it has some features similar to the Russian form of government.
13. American model of corporate governance.
Anglo-American model
The Anglo-American model is characterized by the presence of individual shareholders and an ever-increasing number of independent i.e. non-corporate shareholders (these are called "external" shareholders or "outsiders"), as well as a clearly developed legislative framework defining the rights and responsibilities of three key participants: managers, directors and shareholders and a relatively simple mechanism of interaction between the corporation and shareholders, and between shareholders, both at annual general meetings and in the intervals between them.
Incorporation is a common way for UK and US corporations to accumulate capital. It is therefore not surprising that the United States has the world's largest capital market, and the London Stock Exchange is the third largest in the world in terms of market capitalization after New York and Tokyo. Moreover, there is a causal relationship between the prevalence of equity financing, the size of the capital market and the development of the corporate governance system. The United States is the largest capital market and at the same time the home of the most developed proxy voting system and unprecedented activity of independent (institutional) investors. The latter also play an important role in the capital market and in UK corporate governance.
Key participants in the Anglo-American model
Participants in the Anglo-American model include managers, directors, shareholders (mainly institutional investors), government agencies, exchanges, self-regulatory organizations, consulting firms providing consulting services to corporations and/or shareholders on issues of corporate governance and proxy voting.
Three main participants– these are managers, directors and shareholders. The mechanism of their interaction with each other is the so-called “corporate governance triangle” (Fig. 6).
The Anglo-American model, which developed under free market conditions, involves the separation of ownership and control in the largest corporations. This legal separation is very important from a business and social point of view, because investors, by investing their money and owning the enterprise, are not legally responsible for the actions of the corporation. They delegate management functions to managers and pay them to perform these functions as their business agents. The fee for the separation of ownership and control is called "agency services."
The interests of shareholders and managers do not always coincide. Corporate legislation in force in countries that apply the Anglo-American management model resolves this contradiction in different ways. The most important of them is the election by shareholders of a Board of Directors, which becomes their trustee and begins to fulfill fiduciary obligations, that is, act in favor of shareholders in the exercise of management control functions.
Share ownership structure in the Anglo-American model
During the post-war period in the UK and US there was a shift towards a larger number of institutional shareholders compared to individual investors. In the UK in 1990, institutional investors owned approximately 61% of shares in UK corporations, while individual investors held just 21%. (In 1981, by comparison, individual investors owned 38%). In the United States in 1990, institutional investors owned 53.3% of the shares of American corporations.
The increase in the number of institutional investors has led to increased influence. In turn, this entailed legislative changes that contributed to their activation as participants in corporate relations.
Composition of the board of directors in the Anglo-American model
The boards of directors of most UK and US corporations include both "inside" members ("insiders") and "outsiders". An "insider" is a person who either works for the corporation (manager, executive or employee) or is closely associated with the management of the corporation. An "outsider" is a person not directly associated with the corporation or its management.
A synonym for the word "insider" may be "executive director", and a synonym for the word "outsider" is the expression "non-executive director" or "independent director".
Traditionally, the Chairman of the Board of Directors and the Chief Executive Officer were the same person. This has often led to various abuses, in particular the concentration of power in the hands of one person (for example, the board of directors is controlled by one person who is both chairman and chief executive officer); or the concentration of power in the hands of a small group of individuals (for example, the board of directors consists only of “insiders”); The Management Board and/or Board of Directors attempt to maintain power over long periods of time while ignoring the interests of other shareholders ("entrenchment"); and also to gross violation interests of shareholders.
As recently as 1990, one person served as both chairman and chief executive officer of 75% of the 500 largest US corporations. In the UK, by contrast, most corporations had a non-executive director. However, many UK corporate boards were led by 'inside' directors: in 1992, 42% of all directors were independent directors, and 9% of the largest UK corporations had no independent director at all.
Currently, both American and British corporations are gravitating towards including an increasing number of independent directors on their Board of Directors.
Since the mid-80s. In the UK and USA, interest in corporate governance began to increase. This was facilitated by a number of factors: an increase in institutional investment in both countries, strengthening government control in the United States with the provision of voting rights at annual general meetings shareholders of certain institutional investors; corporate takeover activities in the second half of the 1980s; excessively high CEO salaries in many US corporations and a growing sense of loss of competitiveness vis-à-vis German and Japanese corporations.
As a result, individual and institutional investors began to inform each other about current trends, conduct various studies, and organize to protect their interests as shareholders. The data they collected was quite interesting. For example, studies conducted by various organizations have shown that in many cases there is a connection between a lack of "vigilance" on the part of the Board of Directors and poor corporate performance. In addition, corporate governance analysts have noted that independent directors often do not have as much information as inside directors, and therefore their ability to exercise effective control is limited.
There are a number of factors that have contributed to the increase in the number of independent directors on UK and US corporate boards. These include: changes in the ownership structure, i.e. the increase in the number and influence of institutional investors and their participation in voting at annual general meetings of shareholders, as well as recommendations from independent self-regulatory organizations such as the Financial Affairs Committee of Corporate Governance in the UK and various shareholder organizations in USA.
Board composition and board representation remain important issues of concern to shareholders in the UK and US. This may be because other corporate governance issues, such as information disclosure and mechanisms for interaction between corporations and shareholders, have largely been resolved.
Boards of directors in the UK and US are smaller in size than in Japan or Germany. A 1993 survey of the 100 largest U.S. corporations by the Spencer Stewart Corporation found that the size of boards of directors was decreasing, with an average of 13 members, down from 15 in 1988.
Legislative framework in the Anglo-American model
In the UK and US, the relationship between managers, directors and shareholders is determined by a set of laws and regulations.
In the United States, the federal agency, the Securities and Exchange Commission, regulates the market valuable papers, establishes information disclosure requirements, and also regulates the “corporation-shareholders” and “shareholders-shareholders” relations.
Laws governing pension funds also have an impact on corporate governance. In 1988, the US Department of Labor, which is responsible for the activities of private pension funds, ruled that these funds have a fiduciary duty, that is, they act as “trustees” of their shareholders in the affairs of the corporation. This ruling had a major impact on the activities of private pension funds and other institutional investors: they became interested in all matters of corporate governance, shareholder rights and voting at annual general meetings of shareholders.
It should be noted that in the United States, corporations are registered and incorporated in a specific state, and the laws of that state form the basis of the legal framework for the rights and responsibilities of the corporation.
Compared to other capital markets, the US has the most stringent disclosure rules and a clear framework for shareholder relations. As mentioned above, this has direct relation to the size and importance of the securities market in the US economy and internationally.
In the UK, the legal framework for corporate governance is set by Parliament and may be subject to the rules of independent bodies such as the Securities and Investments Authority, which is responsible for overseeing the securities market. It should be noted that this Board is not the same government structure as the US Securities and Exchange Commission. Although the legal framework for disclosure and shareholder relations in the UK is well developed, some observers believe that the English system lacks self-regulation and requires a civil service similar to the US Commission.
Stock exchanges play an important role in the Anglo-American model, determining listing requirements, the level of information disclosure and other requirements.
Disclosure requirements in the Anglo-American model
As noted, the United States has perhaps the most stringent disclosure standards. Other countries using the Anglo-American management model also have high disclosure requirements, but not to the same extent as in the United States, where corporations must publish a wide range of information. The following information must be included in the annual report or the agenda of the annual general meeting of shareholders (the official document name is “Notice to Shareholders for Proxy Voting”): financial information (in the United States, these data are published quarterly); capital structure data; a certificate of previous activities of the appointed directors (including names, positions held, relations with the corporation, ownership of shares in the corporation); the amount of salary (remuneration) paid to executive directors (senior management), as well as information on the payment of remuneration to each of the five highest paid executives (their names must be indicated); data on all shareholders owning more than 5% of the share capital; information about a possible merger or reorganization; proposed amendments to the Charter, as well as the names of persons or corporations invited to audit.
In the UK and other countries using the Anglo-American model, disclosure requirements are similar. However, reporting is provided every six months, and, as a rule, the amount of data provided is less in all categories, including financial information and information on appointed directors.
Corporate actions requiring shareholder approval in the Anglo-American model
The two actions that require mandatory shareholder approval in the Anglo-American model are: this is the election of directors and the appointment of auditors.
There are also other, extraordinary issues that require shareholder approval. These include: the establishment or amendment of stock option plans (which directly affects compensation of managers and directors); mergers and acquisitions; reorganization, amendments to the charter of the corporation.
There is one important difference between the UK and the US: in the US shareholders do not have the right to vote on the amount of dividends proposed by the Board of Directors, but in the UK, on the contrary, this issue is put to a vote.
In the Anglo-American model, shareholders have the right to put proposals on the agenda of the annual general meeting of shareholders. These proposals, called shareholder proposals, must relate specifically to the corporation's operations. Shareholders owning more than 10% of the corporation's capital also have the right to convene an extraordinary meeting of shareholders.
In the United States, the Securities and Exchange Commission has issued many different rules on the form and content of shareholder proposals, the timing and publication of these proposals. The commission also regulates interaction between shareholders.
Relationships between participants in the Anglo-American model
As noted above, the Anglo-American model clearly defines the issues of relations between shareholders and the relationship of shareholders with the corporation. Independent and self-regulatory organizations play an important role in the management of a joint stock company (corporation).
Shareholders may exercise their voting rights without attending the annual general meeting. All registered shareholders receive the following documents by mail: the meeting agenda with all necessary information, all proposals, the corporation's annual report and the voting ballot.
Shareholders have the option of voting “by proxy,” meaning they fill out a ballot and mail it to the corporation. By sending a ballot by mail, a shareholder authorizes the Chairman of the Board of Directors to act on his behalf, that is, to act as his proxy and distribute his votes as indicated in the ballot.
In the Anglo-American model, institutional investors and various financial professionals monitor the corporation's performance and corporate governance. These include investment funds (for example, index funds and industry-specific funds); venture capital funds, or funds that invest in new corporations; agencies that evaluate the creditworthiness of borrowers or the quality of securities; auditors and funds focusing on bankrupt enterprises or unprofitable corporations.
In the Japanese and German models, many of these functions are typically performed by one bank. That is, in these models there is a strong relationship between the corporation and its main bank.
In Russian and foreign literature Several dozen definitions of the concept of corporate governance have been proposed; in this chapter we will limit ourselves to two that most fully characterize relations with external environment companies.
Corporate governance is a process by which a balance is established between economic and social goals, between individual and public interests. On the other side, To corporate governance - it is a set of mechanisms used to maintain an adequate balance between the rights of shareholders and the needs of the board of directors and management in the process of running a company.
Thus, the main task of corporate governance is to maintain a balance of responsibility of the board of directors to shareholders, management to the board of directors, owners of large blocks of shares to minority shareholders, and the corporation to society.
Over the past thirty years, the institution of corporate governance has actively spread, mainly in developed countries ah, in this regard, management is based on taking into account the interests of shareholders and their role in the development of the corporation. This is management based on ownership, corporate communications, corporate development strategy and culture, taking into account traditions and principles of collective behavior.
Currently, the most common corporate governance models are Anglo-American where economic interests predominate, German (Germanic) where social interests predominate, as well as Japanese model , representing humanitarian interests.
The Anglo-American model operates where a dispersed share capital structure has been formed, i.e. dominated by many small shareholders. This model implies the existence of a board of directors that performs both supervisory and executive functions. The proper implementation of both functions is ensured by the formation of this body from non-executive, including independent directors, and executive directors.
The German model develops on the basis of a concentrated share capital structure, in other words, when there are several large shareholders (federal banks). In this case, the company's management system is two-level and includes, firstly, a supervisory board (it includes representatives of shareholders and employees of the corporation; usually the interests of the staff are represented by trade unions) and, secondly, executive agency(board), whose members are managers. A special feature of such a system is a clear separation of the functions of supervision (given to the supervisory board) and execution (delegated to the board). In the Anglo-American model, the board is not created as an independent body; it is part of the board of directors.
As for the Japanese model, in Japan, as in Germany, a significant part of the shares is owned by banks and other financial institutions that are headed by large economic groups (keiretsu). In Asian and Eastern countries, the practice of cross-shareholding is generally common.
In countries with transition and rapidly developing economies, corporate governance solves the problems of organizational and legal management of business, optimization of organizational structures, intra- and inter-company relations in accordance with the postulated goals of activity. This feature distinguishes, for example, the Russian and Chinese models of corporate governance, where there is widespread participation in joint stock ownership, the formation of complex options for interweaving capital on the basis of share capital, and a changing composition of interested participants. On the other hand, corporate values are not always built taking into account the internal culture and characteristics of the external economic environment; in this case, the corporate governance system does not become a tool for the promotion and development of the enterprise, but only strives to correspond to the high ratings of audit companies.
Financial and economic crisis of 2008-2009. showed that existing models of corporate governance were an indirect cause of its occurrence, since they relied on a set of public procedures for assessing auditors and obtaining a rating. It was this risk assessment model that showed its inconsistency, marking the beginning of the search for a new system of external assessment of companies.
The so-called proper corporate governance system is created to solve three main tasks facing the company: ensuring its maximum efficiency; attracting investments; fulfilling legal and social obligations. Only such a model can be called an appropriate system, the implementation of which truly ensures synergy of financial, social, and cultural interests of owners, managers and stakeholders.
A system of proper corporate governance is needed, first of all, by open joint-stock companies with a large number of shareholders, doing business in industries with high growth rates and interested in mobilizing external financial resources in the capital market. However, its usefulness is undoubted for JSCs with a small number of shareholders, CJSCs and LLCs, as well as for companies operating in industries with medium and low growth rates. The implementation of such a system allows you to optimize domestic business– processes and prevent the occurrence of conflicts by properly organizing the company’s relations with owners, creditors, potential investors, suppliers, consumers, employees, representatives government agencies and public organizations.
IN modern Russia The corporate governance system dates back to the 90s of the last century, which is associated with the opening of the foreign economic activity market for private enterprises. Considering our young age, our system has not yet been fully formed, according to legislative and social characteristics it gravitates towards both the Anglo-American and German ones in terms of the level of response to the market Russian model Corporate governance is called entrepreneurial.
As you know, historically, world business has developed from simple to complex forms: first - individual and family firms, then - partnerships of entrepreneurs, and only later did the corporation appear - the highest form of organization of entrepreneurial activity.
Russian business in the 1990s, he actually went through this path again and at first was ill-prepared for real corporate relationships. In this regard, enterprises expanding their zone of influence outside the Russian Federation faced even greater difficulties in complying with the business customs of the foreign economic environment. This is also due to legal inconsistencies.
Over the past 18 years, significant progress has been made in Russia in creating an institutional framework for corporate governance. The Civil Code of the Russian Federation, the Code on administrative offenses, Arbitration Procedure Code, laws “On joint stock companies”, “On production cooperatives”, “On limited liability companies”, “On national enterprises”, “On the securities market”, “On the protection of the rights and legitimate interests of investors in the market” securities”, “On insolvency (bankruptcy), the Code of Corporate Conduct (developed under the auspices of the Federal Securities Commission in 2001), as well as a number of other regulatory documents. The described block of laws facilitates the functioning of companies in the national environment, however, when an enterprise enters a foreign market, the enterprise faces the task of integrating into the world market. In this case, one of the regulators of the enterprise’s value system for the internal and external business environment is the code of corporate conduct.
Analysis of modern corporate governance models
Kambarov Jamoliddin Khikmatillaevich,
Candidate of Economic Sciences,
Akramova Sitora Saidullaevna,
applicant.
Fergana Polytechnic Institute, Uzbekistan.
Many foreign researchers have identified several basic models of corporate governance, which have influenced the legislation of foreign countries for two centuries.
A corporate governance model is a management system of a certain type, which represents a certain composition of the management bodies of a joint-stock company with special relationships, certain accountability, which embodies a certain list of powers and responsibilities. Although the management structure of a joint stock company in each country has specific features, at the same time there are many common features of corporate governance , which allows us to distinguish two main models of corporate governance: Anglo-American and continental European.
It is believed that the main differences between them are contained in the following aspects: legislative regulation, key participants and founders of the corporation, characteristics of the share ownership structure, the system of governing bodies and the principles of distribution of powers between them, the organization of the secondary securities market, mechanisms of interaction between the main participants.
In England, the USA, Great Britain, Australia, New Zealand, and Canada, the Anglo-American model is completely dominant, which is based on the principle of strict separation of ownership and management, on the developed institution of property rights. There are a number of features of the Anglo-American model of corporate governance.
Rice. 1. Anglo-American model of corporate governance .
Let us highlight the main characteristics of the Anglo-American model of corporate governance.
Dispersion of share capital. A shareholder who owns only 2-5% of the shares of a joint stock company can be a large shareholder. One half of all shares of American companies are privately owned, the other half is controlled by institutional owners (pension funds, insurance companies and investment funds), the number of which has increased since the 50s. last century, is constantly increasing.
Main distinguishing feature The Anglo-American model is the presence of minority shareholders in the share capital. This phenomenon consists of the dispersed location of financial resources in the United States and the interest in the participation of the entire team in corporate governance. Organizing the activities of corporate governance consisting of small investors is more complex than other models. At the same time, difficulty in management arises due to large quantity shareholders.
In other countries where this model prevails, the situation is generally similar: in the UK in 1998, institutional investors owned 65% of the shares of British corporations, and the total financial assets of institutional investors in Canada in 2002 amounted to 102% of GDP, while in Germany - 57.5% of GDP.
High level of self-regulation. A joint stock company tends to self-regulate in business matters; government intervention occurs only if self-regulation fails. Raising capital from individual investors occurs mainly through the stock market without the direct participation of banks, whose role is limited. The high level of self-government of joint-stock companies reduces the state's attention to corporations. This phenomenon, due to the weakening of the state mechanism that protects corporations from external factors, leads to an increased likelihood of bankruptcy.
Strict compliance legislative regulation activities of companies. Relationships in the field of corporate governance are regulated by the state legislative framework, a set of state laws and standards of non-governmental organizations. Over the past two decades, the United States has adopted a significant number of government regulations that allow corporate boards of directors to consider the interests of other corporate stakeholders other than shareholders.
Strict requirements for corporate disclosure of information. Openness of information is suitable for all models of corporate governance. But this model requires openness of information more than other models. This is due to the rapid change of shareholders and the activity of the securities market.As noted, the United States has very strict disclosure standards. The following information should be included in the annual report or the agenda of the annual general meeting of shareholders: financial information, data on the capital structure, information on the past performance of directors who are appointed, the amount of total remuneration for management, information on shareholders who own more than 5% of the share capital capital, information about a possible merger or reorganization, etc. In other countries that use the Anglo-American corporate governance model, disclosure rules are also high, but not to the same extent as in the United States.
Stock exchanges play an important role in the Anglo-American model, determining the level of information disclosure and other requirements.
Supervisory Board. The Anglo-American model is characterized by a management structure such as a board of directors, which consists of executive and independent directors. The number of independent directors on the board of directors of US companies generally equals or exceeds the number of executive directors. The chief executive officer plays a significant role, and the success of the company itself is closely linked to his personal qualities manager and leader.
The following positive features of the American model can be identified:
- the formation of an active securities market as a result of the dispersion of share capital;
- availability of constant accurate information for potential investors;
- the high level of self-government of joint-stock companies makes it possible to implement independent activities;
- perfect development of the legal framework of the state mechanism regulating the activities of joint-stock companies.
The German model of corporate governance is typical for central European countries and is widely used in German and Austrian corporations, and some elements have been borrowed by corporations in France and Belgium.
Rice. 2. German model of corporate governance .
Western European modelcharacterized high degree concentration of shareholder ownership, with the majority of corporate shares owned by other companies. It is based on the principle of social interaction - all parties interested in the activities of the corporation have the right to participate in the decision-making process. The basis of the principle of social interaction of the German corporate governance model lies in the deep traditions of the German economic system, focused on cooperation and social harmony to achieve national prosperity and wealth. The main stakeholders in the corporation's activities include shareholders, managers, employees, key suppliers and consumers of products, banks and various public organizations.
The main characteristics of the German model are the following:
Concentration of ownership. There is a high concentration of shares in the hands of medium and large shareholders and significant cross-ownership of shareholdings. A distinctive feature of the German model is the close connection between banks and industry. Most German corporations provide the advantage of bank financing to joint stock companies, and therefore the capitalization of the stock market is small compared to the potential of the economy. On the basis of shareholder, financial and economic ties, intersectoral integration of industrial concerns with financial institutions into stable horizontal industrial and financial associations. Banks take part not only in the financing of investment projects, but also in management, so large banks, as a rule, become centers for creating corporations in Germany.
The legislative framework. The legislative framework in the German model is based on protecting the interests of employees, corporations, banks and shareholders in the corporate governance system. Regarding small shareholders, German law allows the purchase of shares through banks, which are depositories and have the right to vote as they see fit. Quite often this leads to a conflict of interest between the bank and the shareholder. In addition, legal restrictions on voting rights and the inability to vote by mail also discourage shareholder participation in corporate affairs.
Germany has a strong Federal tradition. Federal and local (land) laws influence the management structure of joint stock companies. Federal laws include laws on joint stock companies, laws on stock exchanges, commercial laws, as well as the above laws on the composition of supervisory boards. However, regulation of the activities of exchanges is the prerogative of local authorities. Federal agency for securities was created in 1995. It supplemented the missing element of German legislation.
Transparency of information disclosure. The disclosure rules in the German model are less stringent than in the Anglo-American model. For example, financial information is reported semi-annually, rather than quarterly, data on remuneration of directors and managers is not specific to individuals, and financial reports are more generalized.
Two-level system of controls. An important feature of the German model is the existence of a two-tier system of management bodies - a supervisory board, which consists exclusively of non-executive directors, and a board formed only of executive directors. This model quite clearly distinguishes between the functions of direct management of the current activities of the enterprise, for which the board is responsible, as well as control over the work of management, which is carried out by the supervisory board.
Rice. 3. Japanese model of corporate governance.
A separate, independent, multifaceted model of corporate governance is the Japanese model, the main characteristic features of which are the following:
A group of interrelated companies. The main structural unit of business is not a single company, but a group of interconnected companies called “keiretsu”, and the main indicator of business success is the success of not one company, but the whole group, which, in turn, contributes to the development of the national economy.
Concentration of ownership. In Japan, the stock market is entirely in the hands of financial institutions and corporations. The practice of cross-shareholding between group member companies is supported. Just like in the UK and the US, the number of institutional shareholders in Japan increased markedly in the post-war period.
Availability of universal banks. The Japanese corporate governance system is based around the core bank and financial-industrial network, or keiretsu. Almost all Japanese corporations have a close relationship with their main bank. Banks play such an important role in Japanese business that every business strives to establish a close relationship with one of them. The bank provides its corporate clients with loans and services for issuing bonds and shares, and carries out settlements and consulting operations. The main bank is usually the majority owner of the corporation's shares.
Management is based on the principle of social unity. The Japanese model is focused on the social unity of all participants in a joint stock company - at the level of an individual company, an interconnected group of companies and society as a whole. Cooperation, as well as decision-making through mutual agreement, is encouraged and supported in this corporate governance system.
Formally, corporate governance bodies in Japan do not differ from the Anglo-American model, but on the informal side, their practices differ significantly. Various informal associations will play a great role in Japan - unions, clubs, professional associations, which pay great attention to supporting friendly, trustingrelations and facilitate the exchange of information among top-level management of different interacting companies. For financial-industrial groups, the most influential body of this type is the group's presidential council, which is elected monthly from among the presidents of the main companies of the group. In an informal setting, important information is exchanged and key decisions are softly agreed upon.
Thus, the above models of corporate governance have both their own characteristics and similarities. In our opinion, the main feature that distinguishes corporate governance models is the difference between economies that are market-oriented, and between economic systems that are oriented towards banks or connections in the middle of groups of market participants. The market models of the United States and the United Kingdom differ from banks, which are oriented towards the models of continental European countries, such as Germany, and the Japanese model, based on social cohesion. In the latest models, firms and banks enter into long-term relationships with joint stock companies, which are different from the arm's length public financing schemes typically associated with market-oriented economies.
Comparative characteristics of corporate governance models in the textbook by B.Yu. Khodiev “Corporate Governance” are presented as follows:
Table 1.
Mutually distinctive features of corporate governance models.
|
Characteristics of models |
Anglo-American model |
German model |
Japanese model |
|
System of social values |
Individuality, freedom of choice |
Izhtimoy hamkorlik |
Cooperation and trust |
|
The role of the workforce |
Passive |
Active |
Active members |
|
Main method of financing |
Banks |
Banks |
|
|
Inconsistency of information |
Management |
Management, “home” bank |
Main Bank |
|
Investment terms |
Short-term |
Long term |
Long term |
|
Cost of capital |
High |
Average |
Low |
|
Capital Market |
Highly liquid |
Liquid |
Relatively liquid |
|
Basic economic unit (in large business) |
Company |
Holding |
Financial and industrial group |
|
Management payment |
High |
Average |
Low |
|
Share capital structure |
Scattered |
Relatively collected |
Collected |
As is known in Germany, Italy and France, unlike the USA and Great Britain, companies are controlled by a relatively small number of shareholders. This order is called “concentrated ownership” (concentrated ownership/property). In these jurisdictions, the prevailing approach is that a shareholder is only controlling if it owns, directly or indirectly, 20% of the voting power.
As a result of the analysis of modern corporate governance models, the following conclusions were formed:
1. There are three main types of corporate governance models. When using k.l. country of one of the types of corporate governance, it is obliged to use the criteria and organizational structure of one of the existing models. The models are based on 3 fundamental principles for the formation of corporate governance.
2. There is no single generally accepted model of corporate governance. Those. The corporate governance models formed in certain countries are not completely identical. In their system government controlled or corporate cooperation there are certain differences. Even in countries that use the same corporate governance models, there are differences in how they are applied in practice.
3. When developing national models of corporate governance, all countries rely on their values and traditions. Even among enterprises operating in the same country, it is impossible to meet the same standards of corporate governance. This indicates that the formation of the country's corporate governance was based not only on state traditions, but also on the traditions of the enterprise.
4. If, when developing a national corporate governance model, the k.l. standard is copied and used. another state, then it will not give the expected economic and social efficiency. Because the models of the USA, Germany and Japan are based on their socio-spiritual atmosphere, the history of the formation of traditions, as well as unique national and state values. Therefore, when using these models in other countries, they cannot be copied completely. If k.l. an enterprise or state wants to apply these models, then first, they should be thoroughly studied and, having identified the part that is suitable for itself and based on the specifics of the state, you need to develop your own model. Only in this case will corporate governance be truly successfully implemented both on the basis of state legislation and on the basis of social norms.
As studies have shown, the level of development of corporate governance in different countries of the world differs from each other, and a system developed in one state loses its relevance in another. And the reason for this is. Not a single copy of the model will be sold in another country with the same success. And also, none of the analyzed models can be considered predominant. Because Japan and Germany models in the USA or US model in Japan and Germany will not give high efficiency.
Literature
1. A.N. Asaul, V.I. Pavlov, F.I. Beskier, O.A. Mouse. – Corporate management and corporate governance. – K.: Humanistics, 2006. – p. 294.
2. Blumgardt A. Models of corporate governance. – K.: Nauk Mysl, 2003. – p. 380.
3. B.Yu. Khadiev, R.Kh. Karlibeva, N.I. Akramova. Corporate governance. – K.: Chulpan, 2011.
4. Kozachenko G.V., Voronkova A.E.Corporate governance: a textbook for universities. - Kyiv: Libra, 2004. - p. 480.
5. PopovaA.V.Basic national models of corporation management // www.iet.ru.
6. Stetsenko B. Formation of the domestic model of corporate governance in the context of world experience K.: Securities of Ukraine. - 2005. - No. 35. P. 10-12.
The corporation as a form of organization for collective property management arose for the first time in economic history on the territory of Europe. Its origins can be traced back to Ancient Greece and Rome. Then it was developed in the forms of collective business by merchants of the trading countries of the Mediterranean. But in its most complete form, the corporation emerged during the industrial revolution in England. Exactly English version corporations and was the basis for the creation of US business legislation at the end of the 18th - beginning of the 19th centuries. Over time, under the influence of the historical characteristics of the development of capitalism in the United States, a specific model of corporate governance was formed, different from the models of other industrialized countries. Moreover, today the corporation is seen as a purely American phenomenon.
A corporation in the USA is established only by decision of a state government representative, who records the fact of its formation by a special act (Act of preliminary incorporation - Article of Incorporation, Certificate of Incorporation).
A corporation may have both its own and tradename. It must include one of the following words or abbreviations: “Corporation”, or “Cogr.”; "Incorporated", or "1ps."; Some states allow the use of the word "Limited" or "Ltd".
Organizing a business in the form of a corporation is expensive Money and time, compliance with numerous registration formalities. When creating a corporation, mandatory registration fees, a business tax, and commercial activities statewide (franchise tax), annual report processing fees and other fees.
Enterprises in some areas of activity, such as the provision of legal, medical, auditing services, are not entitled to receive the status of a corporation, since specialists in these areas, due to the specifics of their activities and the need to comply professional ethics are required to bear responsibility for unqualified actions, which becomes difficult in the presence of limited liability. For example, California law prohibits the creation of corporate entities that require a license or certificate to operate. More than 100 types of businesses are subject to the ban: legal and attorney offices, real estate agencies, firms specializing in pest control, etc. Some states allow licensed activities in the form professional corporation(professional corporation, R.S.; professional service corporation, R.S.) or professional association (professional association, R. A.). It is distinguished by the fact that it is established solely to provide professional services, for which each shareholder must be licensed.
The limited liability of shareholders for the obligations of a corporation is not absolute. Under certain circumstances, such as failure to pay franchise taxes, failure to comply with annual and periodic reporting requirements, or failure to notify the Secretary of State of a change of headquarters, a court may deem a corporation a partnership with the resulting unlimited liability of the owners.
The corporation has a complex organizational structure. The law requires a corporation (mostly an open type) to hold annual meetings of shareholders with a mandatory quorum, and to draw up minutes of the meetings and decisions made based on their results. It is also mandatory to maintain accounting records and publicly publish an annual financial report on activities, which makes the corporation more vulnerable to competitors.
The reasons for the dominant position of corporations in the US economy lie in the following.
The corporation is the most convenient form attracting capital to organize large projects. It allows, by issuing shares, an almost unlimited accumulation of funds from both small and large investors for the development of production, and to mobilize a workforce of the required qualifications.
An enterprise in corporate form can exist indefinitely. The activities of the corporation continue regardless of the death, bankruptcy, or recognition of its participants as incompetent. If a shareholder decides to leave the corporation, he has the right to assign his share to another shareholder or a third party who will continue to participate in the business.
Small corporation with no more than 100 members under Subchapter S Tax Code The US has the option to choose the tax status of the partnership. But this form is subject to a number of restrictions. An S corporation can only have one class of shares. The majority of its income must be earned through active operations rather than passively through dividends and proportionate distributions. Its shareholders cannot be foreign individuals- non-US residents, other corporations and trusts.
The corporation has a choice for tax reporting financial year(fiscal year) that does not coincide with the calendar year or financial year shareholders, which allows saving money by reducing tax payments on future income.
The main distinguishing feature of the American corporate model is that only shareholders have the right to influence its policies and strategic decisions. Neither the state nor the banks providing corporations financial resources, V normal conditions have no right to interfere in the management process. And only in cases where a corporation is threatened with bankruptcy does the state, by a court decision, receive the opportunity to protect the interests of shareholders. Banks were purposefully removed from the cycle of operational management of corporations after the crisis of 1929. A system was formed in which banks play the role of financial infrastructure, and their ability to own stakes in corporations is significantly limited.
The interests of a corporation in the American model are identical to the interests of its shareholders as an organized group. Managers and employees who make up the group of employees and are called upon to carry out the instructions of the owners are not included in the corporation. In this case, managers act as agents of shareholders, who are delegated limited rights to the operational management of the corporation.
The key management problem in the American model is to reconcile the interests of managers, as a group with significant de facto power in the corporation, and the interests of shareholders. The difference in interests is due to the fact that managers, in addition to the corporation, are included in a broader system of social relations, which often has a much stronger influence on the formation of the structure of their interests than intracorporate relations. For example, the social status of a manager in the United States largely depends on the size of the company where he works and on his place in the hierarchy, and therefore the manager of a corporation has a group interest in increasing the size of the company and complicating its hierarchy. This is done at the expense of retained earnings, i.e. by reducing dividend payments, which may be contrary to the interests of shareholders.
There are many areas in corporate governance where the interests of owners and managers may conflict. In this regard, in American business practice there are mechanisms, primarily legislative, that, on the one hand, prevent the emergence of such conflicts, and on the other hand, contribute to their most effective resolution.
In accordance with the laws on corporations that exist in each state, the main body that carries out the policies of the owners in the management process is the board of directors. Directors are personally elected at general meetings of shareholders.
The relationship between the corporation as grantor and the directors as fiduciaries is governed by the rules fiduciary responsibility(fiduciary duty), according to which fiduciaries bear personal criminal liability to shareholders for the decisions made and the effectiveness of their implementation.
Under state fiduciary liability laws, all corporate executives who serve on the board of directors (called officers of the corporation) also face criminal liability if they inadvertently mislead shareholders. Every corporation is required by law to have such officers. Their list is in mandatory must be enshrined in the internal charter. The principal officers are the President, the Chief Financial Officer and the Secretary of the Corporation. The first two are mainly related to property management, the latter is responsible for organizing interaction between shareholder owners. But a corporation can appoint any number of officers it needs to enhance the personal responsibility of management.
A feature of the American model is the very high fragmentation of the shareholding: in most large companies, the number of shareholders amounts to hundreds of thousands and millions, and the largest blocks of shares amount to a few percent. This means that none of the shareholders has virtually no ability to control the actions of management, i.e. really influence the management process. Under these conditions, the state takes on the function of protecting the interests of the mass of disparate small shareholders. In its system there are bodies that control the activities of corporations with mass shareholders (Federal Securities and Exchange Commission). The United States also has a fairly developed network of private firms that conduct continuous independent assessments of the activities of all leading corporations.
The operation of this entire system is based on the fact that every corporation with mass shareholders is obliged to provide its shareholders and the general public with the information necessary to make investment decisions. This requirement is enshrined in law, and it creates a regime of high corporate transparency that is not found in any other country.
The high fractionalization of shareholdings leads to the fact that many employees themselves become co-owners of their corporations and receive a formal opportunity to participate in management. In addition, shareholdings are used to reward employees and management, including directors. As a result, the line between owners and employees is blurred. This, on the one hand, creates powerful incentives for increasing the efficiency of corporations, on the other hand, it creates a stable zone of so-called conflict of interests, which periodically manifests itself in the form of major corporate scandals. last series Such scandals were associated with the Enron company, in which directors and officers deliberately deceived not only shareholders, but also the state and all its regulatory bodies. As a result of the ensuing proceedings, the legislation on corporate reporting was significantly tightened and the level of criminal liability of directors and officers was increased.
The dispersion of the shareholding along with high level The development of the securities market has another important consequence - the majority of shareholders are not tied to the corporation by any obligations other than their investments in shares, and evaluate their involvement in the business only by the size of dividend payments or by the increase in the market value of shares. When problems arise, shares easily change their owners, and new people come to power. This ease of change of ownership has important consequences for the organization of corporate structures: in the system of division of power within the corporation, the emphasis shifts in favor of professional management.
Finally, the described model assigns a secondary role to the state. In the American tradition, it is viewed as an undesirable element of corporate development; its participation should be minimal and limited only to the establishment of “rules of the game” that are the same for all market participants.
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