In today’s briefing:
- Attention Should Be Paid to Whether the Pseudo Cross-Shareholdings Will Hinder Management Reform
Attention Should Be Paid to Whether the Pseudo Cross-Shareholdings Will Hinder Management Reform
- An increasing number of companies had eliminated shareholder benefit plans, but reducing cross-shareholdings and caution toward activist investors may have been the motivating factors in the reversal of this trend.
- If managers distract from management reform by gaining the support of individual investors through shareholder benefits, the stock benefit program will become a pseudo cross-shareholding.
- Shareholder benefit programs and shareholder returns cannot be compared in the same manner. Companies shouldn’t underestimate the fact that the problem with this lies in “principle of equality of shareholders.”
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