Corporate Governance in Spain (with an Application of the Power Indices Approach)

Authors: Leech D.¹; Manjón M.C.²

Source: European Journal of Law and Economics, Volume 13, Number 2, March 2002 , pp. 157-173(17)

Publisher: Springer

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Abstract:

This paper describes the governance system of Spanish listed firms in the early 1990's. Although the institutional setting of the Spanish Stock Exchanges differs little from other European national markets, we found important differences in several aspects of corporate governance. In particular, some of the standard mechanisms of control (e.g. boards and institutional shareholders) do not play an active role, whereas ownership is relatively concentrated. Moreover, power indices suggest that controlling blocs of large shareholders are very likely to form. We thus conclude that the ownership of shares is a pivotal mechanism in the governance of Spanish corporations.

Keywords: control; corporate governance; ownership; power indices; Spain

Language: English

Document Type: Regular paper

Affiliations: 1: Department of Economics, University of Warwick, Coventry CV4 7AL, UK D.Leech@warwick.ac.uk 2: Department of Economics (University Rovira i Virgili), Avda. Universitat, 1, 43204-Reus, Spain mma@fcee.urv.es

Publication date: 2002-03-01