Corporate Finance and Governance
The module bridges the gap between corporate finance and corporate governance. It introduces the concept of corporate governance, discusses its theoretical underpinnings, and details the role of various internal and external governance mechanisms in addressing agency problems arising in modern corporations. The module also highlights the differences between governance systems across the world. The course material is based on seminal readings as well as more recent academic research in the area and it demonstrates the relevance of corporate governance issues to both business and policy makers. The teaching is organised in the form of lectures and smaller-group seminars.
Cross-country differences between governance systems around the world are one of the key issues the module focuses on. In particular, the syllabus highlights the variation in relevance and prevalence of various corporate governance mechanisms in different legal systems.
All of the resources for this module (except for the core textbook) are in electronic form only. The syllabus covers some aspects of corporate social responsibility (CSR) and its relevance for corporate governance while discussing emerging topics in corporate governance.
Students learn to apply insights from the recent academic literature in the context of real-life governance problems. They also develop their skills in team-working, presentation, and independent thinking in this module.
Full module specification
|Module title:||Corporate Finance and Governance|
|Duration of module:||
Duration (weeks) - term 2: |
The aim of the module is to familiarise the students with the notion of corporate governance, its theoretical underpinnings, and the role of various corporate governance mechanisms. The knowledge of the relevant academic research and the understanding of major cross-country differences regarding corporate governance regulation and practice across the world should then allow students to propose effective solutions to governance challenges arising in corporations and in the regulatory setting.
ILO: Module-specific skills
- 1. comprehensively understand the notion of corporate governance, its theoretical underpinnings, and the role of various corporate governance mechanisms
- 2. comprehensively understand major cross-country differences regarding corporate governance regulation and practice
- 3. evaluate critically and comparatively the usefulness of various corporate governance mechanisms in addressing agency problems in different institutional settings
- 4. critically appraise how the insights of corporate governance research have informed the policy debate and shaped the corresponding institutional framework in different country settings
- 5. effectively demonstrate familiarity with the recent developments in corporate governance research and practice
ILO: Discipline-specific skills
- 6. comprehensively understand the financial decision making process and apply it in solving of complex governance problems
- 7. propose novel solutions in financial and governance problem solving and make decisions in unpredictable situations
- 8. independently interpret financial data and problems in the light of established
- 9. access, synthesise, and evaluate with minimum guidance a body of relevant existing research, critically appraise it, and use it as a guidance in addressing real life corporate finance and governance challenges
ILO: Personal and key skills
- 10. apply their own criteria of judgement and within the group challenge received opinion and critically reflect on action; seek and make use of feedback
- 11. successfully complete, within a group, a task within a defined period
- 12. interact effectively within a team/learning/professional group, recognise, support or be proactive in leadership, negotiate in a professional context and manage conflict
- 13. present effectively results and achievements of collaborative projects
- 14. analyse critically problems arising in both academic and practical contexts
Learning activities and teaching methods (given in hours of study time)
|Scheduled Learning and Teaching Activities||Guided independent study||Placement / study abroad|
Details of learning activities and teaching methods
|Category||Hours of study time||Description|
|Scheduled Learning and Teaching||22 (11 x 2 hour lectures)||Lectures|
|Scheduled Learning and Teaching||10 (10x 1 hour seminars starting week 2)||Seminars|
|Form of assessment||Size of the assessment (eg length / duration)||ILOs assessed||Feedback method|
|Individual brief report on an academic paper||Max. 250 words||1-4, 8-9, 14||Oral feedback in class|
Summative assessment (% of credit)
|Coursework||Written exams||Practical exams|
Details of summative assessment
|Form of assessment||% of credit||Size of the assessment (eg length / duration)||ILOs assessed||Feedback method|
|Group presentations of academic papers and in-class participation||20||One group presentation per term (max. 25 minutes; max. group size: 3 students)||1-5, 8-14||Specific written feedback to individual groups|
|Mid-term written exam||30||40 minutes||1-9, 14||Standard model answers available at ELE after the exam|
|Final written exam||50||1 hour||1-9, 14||Standard model answers available at ELE after the exam|
Details of re-assessment (where required by referral or deferral)
|Original form of assessment||Form of re-assessment||ILOs re-assessed||Timescale for re-assessment|
|Group presentations of and in-class participation (20%)||Individual written report on an academic paper (max. 1200 words)||1-5, 8-14||Aug/Sep|
|Mid-term written exam (30%)||Referred mid-term written exam (40 min.)||1-9, 14||Aug/Sep|
|Final written exam (50%)||Referred final written exam (1 hour)||1-9, 14||Aug/Sep|
The guidelines for the referred exams are identical to those for the original exam papers. Detailed guidance regarding the individual reports (i.e. the re-assessment for the presentation element) will be issued in due course to students referred in this element.
- Introduction: Theories and mechanisms of corporate governance
- Board of directors
- Executive turnover
- Executive compensation and incentives
- Market for corporate control
- Ownership structure (executive ownership, institutional shareholders and activist investors, conflicts between small and large shareholders)
- Payout policy and corporate governance
- International corporate governance
- Corporate governance rankings and the value of corporate governance
- Emerging issues in corporate governance (e.g. corporate social responsibility, gender diversity)
Indicative learning resources - Basic reading
Basic reading (core textbook, web-based and electronic resources):
- Selection of academic papers available from University of Exeter library collection (Electronic Resources, http://as.exeter.ac.uk/library/resources/e-resources/) or electronic Exeter Learning Environment (ELE, http://vle.exeter.ac.uk/) portal of the course.
- S. Thomsen and M. Conyon (2012). Corporate Governance: Mechanisms and Systems. McGraw-Hill Education: Maidenhead.
- Additional course materials (e.g. lecture handouts) available from ELE portal of the course.
Module has an active ELE page?
Indicative learning resources - Other resources
Other resources (supplementary reading):
D. Larcker and B. Tayan (2015). Corporate Governance Matters: Second Edition. FT Press, Pearson Education Inc.: Upper Saddle River (or: D. Larcker and B. Tayan (2011). Corporate Governance Matters. FT Press, Pearson Education Inc.: Upper Saddle River).
R. A. I. van Frederiklust, J. S. Ang, and P. S. Sudarsanam (2008). Corporate Governance and Corporate Finance: A European Perspective. Routledge: Abingdon.
Last revision date