Corporate governance, role of the best practice codes and protection of minority shareholders in Italy

Abstract

The aim of the paper is analysing the relationship between governance systems and safeguard of minority shareholders in Italy. We believe that an appropriate governance system can favour a fair distribution of value to shareholders of listed companies regardless of the size of the share held. We studied the tender offers made in Italy in the period 2000-2009 to calculate the relationship between the compliance of governance systems with best practices and size of majority premiums paid in take-over transactions, measured through offer prospectuses. The empirical research shows a negative association between the mentioned variables. So this seems to suggest that the compliance with best practice codes can influence the majority premiums in tender offers and protect minority shareholders.