CentER

Peter Roosenboom

Abstract:
This thesis studies the use of corporate governance mechanisms in IPO firms. The IPO often marks the beginning of a more diffuse ownership structure by selling shares to a large group of outside investors. In the thesis corporate governance is viewed as a relevant design issue at the time of the IPO. On the one hand, management may strategically decide to ignore small shareholders' rights and structure corporate governance to its own advantage. This allows management to pursue personal interests that are (possibly) conflicting with those of small shareholders. Alternatively, management may choose to mitigate agency costs by adopting an effective corporate governance structure. In this case, corporate governance is organized to align the interests of management with those of small shareholders. The thesis consists of three studies that examine the use of corporate governance mechanisms by IPO firms in the Netherlands, France and the United Kingdom, respectively.