Faculty of Economics and Business Administration Publications Database

Banks and German Corporate Governance: On the Way to a Capital Market-Based System

Authors:
Tyrell, Marcel
Source:
Volume: 13
Number: 3
Pages: 397 - 407
Month: May
ISSN-Print: 0964-8410
Link External Source: Online Version
Year: 2005
Keywords: Corporate governance, banking system, co-determination, board of directors, complementarity, financial system
Abstract: The German corporate governance system has long been cited as the standard example of an insider-controlled and stakeholder-oriented system. We argue that despite important reforms and substantial changes of individual elements of the German corporate governance system, the main characteristics of the traditional German system as a whole are still in place. However, in our opinion the changing role of big universal banks in governance undermines the stability of the corporate governance system in Germany. Therefore a breakdown of the traditional system leading to a control vacuum or a fundamental change to a capital market-based system could be in the offing.
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