CECL Conference on Responsible Shareholdership – 16 september – Leiden
On 16 september 2011, the Centre for European Company Law organises its 4th conference on Responsible Shareholdership.
Venue: Leiden, the Netherlands. Click for the Conference Brochure.
The ongoing economic crisis has triggered a worldwide self-examination about what went wrong and how we are going to prevent such calamity from happening again in the future. So far, there have been fruitful discussions and initiatives bearing on the capital requirements for commercial banks, on the effectiveness of risk management mechanisms inside financial institutions, on the conflicts of interest that abound in investment banking and on the behavior of the unregulated shadow banking industry of private equity and hedge funds. Corporate governance has largely managed to escape criticism and most commentators point to the failures of executive compensation and to the general unaccountability of management. Shareholders are viewed upon as victims that have seen the value of their portfolio evaporating. Their role in the crisis has remained to a great extent unquestioned or even misunderstood, as legislative initiatives, such as the Dodd-Frank Wall Street Reform shows.
Indeed, in the aftermath of the crisis there has been little discussion on phenomena of perverse shareownership, where shares are loaned, sold short or decoupled from their voting right. Moreover, the fact that in the eve of the financial collapse a great number of shareholders treated their shares as betting slips rather than as genuine titles of ownership in an economic entity has largely gone unattended. Nor have we been concerned with the question of whether computer-generated shareholdings by index funds or other institutional investors are desirable for the proper functioning of corporate governance. And of course we’ve also turned a blind eye to the fact that the end-investors or beneficial owners of stock are legally powerless to push their custodians or their trustees to exercise their voting rights responsibly and with a long-term horizon.
The 4th CECL conference aspires to shed light on these distortions in shareholder governance and to seek ways, by which shareholders will be transformed in responsible corporate constituents able to turn the tide in corporate governance practice that seems to be throwing a vast amount of resources into activities that generate high private rewards disproportionate to their social and economy-wide productivity.