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Restructuring the Board: How Stock Exchanges Can Succeed as For-Profit Firms


  • Faten Ben Slimane

    () (UPE - Université Paris-Est , IRG - Institut de Recherche en Gestion - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12 - UPEM - Université Paris-Est Marne-la-Vallée)

  • Laura Padilla Angulo

    () (Loyola University Andalucía)


We conduct a field experiment using stock exchanges, many of which were forced to demutualize and convert to for-profit structures due to increased competition and technological advances, to study corporate governance restructuring measures to adapt to new market conditions. The financial performance of the stock exchanges we studied significantly improved after their conversion to for-profit organizations and provide an example of successful corporate governance restructuring. We find that the stock exchanges restructured board composition and refocused them to create better value. The exchanges also reorganized their management teams and increased their performance-related compensation. Results suggest that the conversion of a company to a for-profit structure brings efficiencies when accompanied by changes in the governing bodies and the incentive structures. We also find that converting to for-profit firms had a positive impact on the reputation of the exchanges. The positive impact was even greater when accompanied by changes in board composition. Our results are relevant not only to the financial industry but to firms in other sectors considering going public.

Suggested Citation

  • Faten Ben Slimane & Laura Padilla Angulo, 2017. "Restructuring the Board: How Stock Exchanges Can Succeed as For-Profit Firms," Post-Print hal-01583860, HAL.
  • Handle: RePEc:hal:journl:hal-01583860
    Note: View the original document on HAL open archive server:

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