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Corporate governance analysed in the Financial Markets Group's Review

Corporate Governance and the UK and US pension systems are among the topics explored in the latest issue of Review, the LSE Financial Markets Group newsletter, published today (Friday 15 July).

The Financial Markets Group (FMG) is based at the London School of Economics and Political Science (LSE). The Review, produced quarterly, gives details of the FMG's recent projects and events, discussion papers and visitors, including:

  • In Letter But Not in Spirit: an analysis of corporate governance in the UK
    The Enron and other governance failures have resulted in an unprecedented wave of regulation on both sides of the Atlantic. While the US has taken a legislative tone with the Sarbanes-Oxley Act of 2002, the UK has introduced a voluntary code of best practice: a 'comply or explain' approach. But have companies in the UK truly embraced the spirit of this code, or are they merely following the letter of its recommendations?

    New research by Sridhar Arcot and Valentina Bruno at the FMG shows that the Combined Code and its 'comply or explain' approach does not differ much from a prescriptive law. This highlights a common conformity with the letter but not the spirit of the regulation.

  • Reforming Public Pensions in the US and UK 
    Peter A Diamond, MIT, gave a public lecture at LSE on 18 May exploring the public pension systems in the US and UK. The lecture was part of the USB Pensions Research Programme at LSE.

    Professor Diamond explored the expected future financing problems of the US social security system and discussed the reform of the system proposed by the US government, drawing comparisons to the UK system.

  • The Future of Banking Regulation 
    Experts from around the world met at LSE in April for a two-day conference on banking regulation. The event featured three panel discussions on Basel II: on the implications of Basel II, the problems it could cause in emerging markets, and its economic consequences.

    The keynote speaker of the event was Jaime Caruana, Governor, Bank of Spain. Experts speaking on the subject included Ingrid Bonde, director-general of the Swedish Financial Services Authority, Dr Gerd Hausler, director of the International Capital Markets Department, IMF, and Sir Andrew Crockett, president of JP Morgan Chase International. A detailed account of the papers presented is given in the latest issue of Review.

Details of the FMG's Corporate Finance and Governance Research Programme, that has seen over 10 years of research since its launch in 1994, are also given in the newsletter. One of the main areas of research has been the issue of financing young, small and innovative firms, which face the toughest constraints for accessing financial markets but constitute an important engine for growth in developed countries.

All this plus details of recent FMG discussion and special papers and forthcoming conferences, seminars and workshops, in the new issue of Review.

If you would like to receive a copy of the Review please email the Financial Markets Group on fmg@lse.ac.uk| or to join the mailing list, please see http://fmg.lse.ac.uk/mailing/| 

Ends

For more information, contact:

Notes:

Review is the quarterly newsletter of the Financial Markets Group at the London School of Economics and Political Science.

The Financial Markets Group is a research centre at LSE specializing in research into financial markets. Academic faculty and PhD students undertake theoretical and empirical research to advance our scientific understanding of the workings of financial markets, financial decision-making and financial regulation. Research is conducted through a number of principal research programmes:

  • Asset Pricing and Portfolio Management
  • Risk Management
  • Fixed Income Markets
  • Pensions Research
  • Corporate Finance and Governance
  • Regulation and Financial Stability

See http://fmg.lse.ac.uk| for more details.

Sridhar Arcot and Valentina Bruno are PhD students at the Financial Markets Group at LSE. For more information on their research findings please email Sridhar at S.R.Arcot@lse.ac.uk| or Valentina at V.G.Bruno@lse.ac.uk|

15 July 2005

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