Governance and Activist Investors Outside of the U.S.
Activism is spreading around the globe, and this case offers specific examples from Japan, Germany, and China. Japans new governance code, implemented in 2015, has opened the door to more Western corporate governance trends. For example, boards that once featured only company insiders now include more outsiders, and some engagement, or activist, funds have started to exert a stronger influence on the countrys organizations. Activist firms have also sprung up in Germany, although its governance code minimizes the effect of activist investors to some degree so there has been less CEO turnover than in other countries such as the United States. In Hong Kong, activist firms are taking a more active role, and homegrown activist funds have even come into play with such Chinese-based firms as Alibaba and Tencent.
Another type of investment fund is the sovereign wealth fund, and these funds are also taking a more active role in both developed and emerging economies around the globe. They have been known to make investments and exert their influence in a variety of industries. In some cases, these funds use investments to support their home countrys political agenda, for example, by investing in sustainable energy sources.
Assignment Instructions:
As students read the case study found on page 335 of our required textbook (Author: Hitt), they should think about which of the activist shareholder trends are going to help the worlds economy, as well as what effect these activists will have on the scope of globalization throughout the world.
Read the short end-of-chapter case on Governance and Activist Investors Outside of the U.S., and answer questions in the areas of Analysis, Strategy, and Implementation & Performance. APA style format with two pages of content double spaced.
Case Discussion Questions
1.Why are many countries adopting western governance systems similar to those found in the United States and the United Kingdom that are more shareholder friendly?
2. What particular governance devices are helping or hindering good governance in these countries that are changing their. governance systems? Please explain.
3. How do sovereign wealth funds affect governance of firms in home and foreign countries?
4.What would you recommend to improve the governance systems in Japan, Germany, and China, respectively, given the governance devices described in Chapter 10?
Parameters of this assignment: minimum of two pages in APA style format.
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