Hybrid journal (It can contain Open Access articles) ISSN (Print) 1744-6414 - ISSN (Online) 1744-6422 Published by Oxford University Press[419 journals]
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Authors:Fletcher A; Peitz M, Thépot F. Pages: 1 - 4 Abstract: Common ownership by institutional investors—of minority stakes across multiple competing firms—has become a subject of heated debate in the antitrust community. Although often driven by portfolio diversification strategies, rather than anticompetitive intent, common ownership can result, in some sectors, in the concentration of financial ownership, with possible anticompetitive effects. PubDate: Fri, 04 Feb 2022 00:00:00 GMT DOI: 10.1093/joclec/nhab029 Issue No:Vol. 18, No. 1 (2022)
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Authors:Nili Y. Pages: 5 - 28 Abstract: AbstractU.S. academic discourse on director interlocks is not new. Yet, the increased attention to common ownership has also brought to light the increased tendency of interlocked directors to serve in the same industry. I termed these directors as horizontal directors in my earlier work—shining a light on the benefits they bring to investors and companies but also the risks they pose to governance and antitrust law. This article revisits the prevalence of horizontal directors armed with six additional years of data and shows that the prevalence of horizontal directors has remained steady, even as attention to common ownership has increased in recent years. These findings should serve as a clarion call to regulators—urging them to directly address horizontal directors. PubDate: Wed, 20 Oct 2021 00:00:00 GMT DOI: 10.1093/joclec/nhab024 Issue No:Vol. 18, No. 1 (2021)
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Authors:Ghezzi F; Picciau C. Pages: 29 - 74 Abstract: AbstractIn 2011, Italy introduced a ban on interlocking directorates in the financial sector, prohibiting members of the boards of directors and of the internal control bodies, as well as top managers of banking, insurance, and financial companies, from holding any such office in a competing company or group. Empirical studies have demonstrated conflicting results concerning the effectiveness of the Italian anti-interlocking provision. Some studies claim that interlocking directorates have decreased but have not been completely eliminated, which suggests possible persisting limits to competition. Other studies instead show the ban to have a procompetitive effect, at least in the banking sector, which would be at odds with a slight reduction in personal ties. Our article addresses this inconsistency by mapping the interlocking directorates among the 25 largest banking groups and the 25 largest insurance groups operating in Italy before and after the introduction of the ban. We show that although interlocking directorates were widespread at the end of 2010, the interlocking ban reached its goal in the banking and insurance sectors. Anticompetitive effects may, however, still exist, especially considering that the anti-interlocking provision does not affect ownership connections among competing financial companies and groups. PubDate: Fri, 06 Aug 2021 00:00:00 GMT DOI: 10.1093/joclec/nhab014 Issue No:Vol. 18, No. 1 (2021)
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Authors:Azar J. Pages: 75 - 98 Abstract: AbstractThis paper studies the empirical relationship between common ownership and interlocking directorships. I estimate a gravity equation model for the probability that a pair of firms will have a common director, as a function of the geographic distance between the firms, their sizes, and a set of covariates, including measures of common ownership between the firms. The main finding is that, robustly across several measures of common ownership, firm pairs with higher levels of common ownership are associated with a higher likelihood of sharing directors. Also, their distance in the network of directors is smaller on average. Consistent with the “gravity” interpretation, larger firms are more likely to share directors, and firms that are geographically more distant are less likely to share directors. PubDate: Tue, 09 Nov 2021 00:00:00 GMT DOI: 10.1093/joclec/nhab026 Issue No:Vol. 18, No. 1 (2021)
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Authors:Shekita N. Pages: 99 - 134 Abstract: AbstractCommon ownership exists when investors concurrently hold partial and significant shares in related firms. In this paper, I compile, document, and taxonomize 30 separate cases of intervention to demonstrate how common owners influence firm behavior. Although previous literature has identified a link between common ownership and product market outcomes, critics have questioned a common owner’s ability and incentive to alter the behavior of portfolio firms. Missing from the debate are observable interventions from common owners and the mechanisms through which common owners exercise their influence. This paper compiles relevant case studies from media coverage, regulatory proceedings, policy groups, and annual stewardship reports to uncover these channels. PubDate: Thu, 06 May 2021 00:00:00 GMT DOI: 10.1093/joclec/nhab006 Issue No:Vol. 18, No. 1 (2021)
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Authors:Banal-Estañol A; Boot N, Seldeslachts J. Pages: 135 - 167 Abstract: AbstractWe provide a description of ownership patterns in the top 25 European banks for the period 2003–2015, where we especially focus on the global financial crisis. Investment managers, such as Blackrock, are dominant in terms of number of blockholdings in different banks, maintaining fairly stable “common ownership” networks throughout our sample. However, the financial crisis led to capital injections by governments in several banks in trouble, which in turn led to a jump in holdings by governments, which typically are “non-common owners” (i.e., they hold only shares in only one bank). This jump translated into these investors temporarily being the top investor with a large share, and non-common owners being the majority among large shareholders. A brief comparison with US banks uncovers large ownership differences between the European and US banking sectors. We briefly discuss what these ownership patterns might imply for competition, stability and performance in the banking industry. PubDate: Fri, 08 Oct 2021 00:00:00 GMT DOI: 10.1093/joclec/nhab023 Issue No:Vol. 18, No. 1 (2021)
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Authors:Tzanaki A. Pages: 168 - 254 Abstract: AbstractMinority shareholdings have been on the regulatory agenda of competition authorities for some time. Recent empirical studies, however, draw attention to a new, thought-provoking theory of harm: common ownership by institutional investors holding small, parallel equity positions in several competing firms within concentrated industries. While critical voices abound, EU and U.S. antitrust agencies closely follow these developments indicating an appetite to act. This article connects the common ownership debate to merger control and explores: i) the aims and scope of legal control as regards partial acquisitions in different jurisdictions; ii) the nature of potential competition effects arising from passive minority shareholding; and iii) the plausibility of common owners’ anticompetitive strategies from a corporate governance perspective.Drawing a distinction between “concentrated” and “diffuse” common ownership, it sheds light on the different supporting mechanisms and varying harm potential of each variety. “Passive influence” mechanisms characterizing “diffuse” common ownership may not only generate plausible and material competition concerns in given circumstances but present challenges for the effective jurisdictional and remedial design of merger law frameworks. Competition policy should stay current by explicitly recognizing these novel insights in enforcement practice and developing guidelines on how to treat common ownership cases in the future. PubDate: Fri, 19 Nov 2021 00:00:00 GMT DOI: 10.1093/joclec/nhab028 Issue No:Vol. 18, No. 1 (2021)
Hybrid journal (It can contain Open Access articles)
[419 journals]
