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The Anachronism of the Voice-Exit Paradigm: institutional investors and corporate governance in the UK

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Author Info
Photis Lysandrou
Denitsa Stoyanova (London Metropolitan University)
Abstract

The voice-exit paradigm continues to serve as the framework for debating key issues in UK corporate governance. That paradigm, however, has become an anachronism with the recent changes in the scale and organisational structure of the UK asset management industry. As a result of these changes the "holding" and the "selling" of shares tend to be mutually inclusive rather than exclusive acts, and the capital market's corporate governance role is now exercised more through the gravitational pull of equity trading than through the medium of hostile takeovers. If the new realities are to be correctly appraised and factored into the corporate governance codes of conduct, the voice-exit paradigm has to be abandoned in favour of an alternative framework that is attuned to these realities. The aim of this paper is to help develop such a framework. Copyright (c) 2007 The Authors; Journal compilation (c) 2007 Blackwell Publishing Ltd.

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1467-8683.2007.00631.x
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Article provided by Blackwell Publishing in its journal Corporate Governance: An International Review.

Volume (Year): 15 (2007)
Issue (Month): 6 (November)
Pages: 1070-1078
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Handle: RePEc:bla:corgov:v:15:y:2007:i:6:p:1070-1078

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This page was last updated on 2009-12-21.


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