Syllabus

Title
6194 S4INTF1/2 International Finance I / II - Corporate Governance
Instructors
Univ.Prof. Seppo Ikäheimo, Ph.D.
Contact details
fire[]wu.ac.at, seppo.ikaeheimo[]aalto.fi
Type
PI
Weekly hours
2
Language of instruction
Englisch
Registration
02/02/17 to 02/17/17
Registration via LPIS
Notes to the course
This class is only offered in summer semesters.
Dates
Day Date Time Room
Wednesday 03/08/17 01:00 PM - 04:00 PM D4.0.136
Friday 03/10/17 01:00 PM - 04:00 PM D4.0.133
Monday 03/13/17 01:00 PM - 04:00 PM D4.0.136
Wednesday 03/15/17 01:00 PM - 04:00 PM D4.0.136
Tuesday 06/06/17 01:00 PM - 05:00 PM D4.0.136
Wednesday 06/07/17 12:00 PM - 04:00 PM D4.0.136
Friday 06/09/17 01:00 PM - 05:00 PM D4.0.144
Monday 06/19/17 10:00 AM - 01:30 PM D4.0.136
Contents

Please see the course schedule on learn@wu for details.

Readings for diaries:

  • Aguilera R.V., Filatotchev I., Gospel H. & Jackshon G., 2008, An Organizational Approach to Comparative Corporate Governance: Costs, Contingencies, and Complementaries. Organization Science, 19:3, 475-492.
  • Chan M., D’Anna G., Watson I. & Wee M., 2008, Does Disclosure Quality via Investor Relations Affect Information Asymmetry? Australian Journal of Management, 33:2, 375-390.
  • Frydman C. & Jenter D., 2010, CEO Compensation. CESifo working paper: Labour Markets, No. 3277
  • Hermalin B.E. & Weisbach M.S., 2003, Boards of Directors as an Endogeneously Determined Institution: A Survey of the Economic Literature. Economic Policy Review, 9, 7-26.
  • Roe M.J., 2004, The institutions of corporate governance. Harvard Law School, Discussion Paper 488, only pages 1-16.
  • In addition, student reports presented June 3-5, 2013 belong to the reading list. They will be delivered one week prior to the presentations.

Apart from the students' presentations, the reading list will be sent to students by the course instructor by email.

Learning outcomes

After completing this class the student will have the ability to:

  • use the concepts of corporate governance in every day thinking
  • understand the role of good governance in the corporate success
  • understand the relationship between the company management, board of directors and shareholders
  • understand the reasons for the variety in corporate governance practices both within one country and between countries and the recent trend of convergence in corporate governance practices; 
  • understand the theoretical basis of the Board of Directors, Investor Relations, Executive Compensation, Auditing and Internal Control, Ownership Structure and Market for Corporate Control;
  • understand how these institutions constitute the corporate governance bundle;
  • evaluate the quality of corporate governance practices.

Furthermore, after completing this class the student will have the ability to:

  • work independently writing analytical essays based on given material and apply it empirically;
  • work effectively in a team in order to contribute appropriately to the production of a group output, report and presentation;
  • participate in group and one-to-one discussion.


Besides, after completing this class the student will have the ability to:

  • use scientific argumentation skills in the discussions
  • write a short research report based on research papers and empirical material
Teaching/learning method(s)

The main elements of the course are:

  • lecture by the course instructor
  • learning diaries to be made by the students
  • group presentation
  • dialogue between lecturer and students

Please see the information provided within the assessment section for more details.

Assessment

During the course you may achieve 100  points comprising of following elements:

  • max 40 points  final written exam
  • max 20 points  learning diaries
  • max 10 points  class participation
  • max 30 points  group presentation and report

There will be one additional opportunity to take the final exam.

For students attend this class, it is mandatory to read the additional information provided on our learn@wu webpage (you can see it after you registered for the course).

Prerequisites for participation and waiting lists
  • Positive completion of each of the four courses of the subject "Basics Finance, Accounting and Taxation".
  • Positive completion of at least six courses of the subject "Advanced Finance, Accounting and Taxation".
  • Pre-allocation to elective.v
Recommended previous knowledge and skills
  • Basic knowledge in finance
  • Basic knowledge in accounting
Unit details
Unit Date Contents
1

Key points:

  • Organizing the course work
  • Introduction of the basic problems and concepts of corporate governance.

Learning outcomes:

  • Commit to the rules of the game in the course
  • Understand the key concepts of agent, principal and information asymmetry
2

Key points:

  • Principal-Agency theory, stakeholder and stewardship theories
  • Institutions of corporate governance, their different roles and interrelatednes.

Learning outcomes:

  • Basic understanding of theoretical perspectives
  • Basic understanding of each of the corporate governance institutions and of the logic of their interrelatedness.

Readings:

  • Roe, 2004
3

Key points:

  • The divergence of international practices of corporate governance
  • The role of history and organizational environment on the effectiveness of corporate governance bundles
  • The recent convergence of corporate governance practices and the role of codes in the convergence.

Learning outcomes:

  • Understand the major differences in practices between countries and industries from the perspective of corporate governance bundle.
  • Understand the historical reasons for these differences.
  • Understand the need and mechanisms for recent convergence of corporate governance practices.

Readings:

  • Aguilera et al, 2008
4

Key points:

  • The recent knowledge of the role of board of directors (BofD)
  • How does the BofD work
  • How to improve the work of BofD

Learning outcomes:

  • Understand the role of BofD and how it works
  • Understand what matters in the work of board of directors

Readings:

  • Hermalin & Weisbach, 2003
5

Key points:

  • The role of investor relations (IR) in company valuation
  • The nature of IR work
  • The suboptimal practices of IR
  • The need for regulating financial disclosure quality.

Learning outcomes:

  • Understand how IR works in the capital markets
  • Understand reasons and consequences of good and bad IR practices
  • Understand the need for regulation of financial disclosures.

Readings:

  • Chan et al, 2008
6

Key points:

  • The structure and level of executive compensation
  • The challenges in executive compensation

Learning outcomes:

  • Understand the recent development in executive compensation
  • Understand the role of each compensation system
  • Understand the problems related to compensation systems, both in structure and process
  • Able to solve basic executive compensation problems.

Readings:

  • Frydman & Jenter, 2010
Last edited: 2017-02-06



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