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Royal Ahold: A Failure of Corporate Governance and an Accounting Scandal

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  • Jong, A. de
  • DeJong, D.V.
  • Mertens, G.M.H.
  • Roosenboom, P.G.J.

    (Tilburg University, Center for Economic Research)

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    Abstract

    Royal Ahold (Koninklijke Ahold NV) was one of the major success stories in the 1990s and is one of the major failures, suffering a complete meltdown, in 2003.We investigate the strategy, accounting transparency and corporate governance of Ahold; elements which jointly drive the firm s performance over this period of time.In general, the corporate governance, accounting transparency, strategy and firm performance relationships are complex.There is not a fully specified model available to address the inter-relationships, including the endogeneity problem.The econometrics are difficult and constrained not only by the lack of a fully specified theory but also by data availability. Our clinical study overcomes these problems by providing an in-depth analysis of the inter-relationships among corporate governance, accounting transparency and strategy that lead to Ahold s downfall.We provide insights into these relationships and their complexity that present theory and empirical studies cannot address.

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    Bibliographic Info

    Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2005-57.

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    Date of creation: 2005
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    Handle: RePEc:dgr:kubcen:200557

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    Web page: http://center.uvt.nl

    Related research

    Keywords: international economics; financial economics; financial reporting; law and economics; corporate governance; regulation;

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