Country Analyses, Second Edition
Edited by Christine A. Mallin
Chapter 2: Recent corporate governance developments in Spain
Silvia Gómez-Ansón and Laura Cabeza-García INTRODUCTION This chapter reviews the corporate governance situation of Spanish listed companies as well as the legal corporate governance developments that have taken place recently. First, it refers to the Spanish institutional setting; second, it addresses the Spanish codes of best practice and legal rules that have been issued during the last few years; finally, the chapter describes the corporate governance practices of Spanish listed companies. SPAIN’S INSTITUTIONAL SETTING The ‘law and finance’ literature initiated by the works of La Porta et al. (1997a, 1998) argues that the way capital markets function depends on several factors: customs, rules, laws and regulations, and how they are enforced. The origin of a country’s commercial/company law (British, French, German or Scandinavian legal origins) helps to explain the national law on creditors, the rights concerning shareholders and private property, and the country’s level of bank and stock market development.1 Spain belongs to the group of countries with a French civil law origin. Table 2.1 shows the legal, equity and debt financing and ownership characteristics of Spain according to the papers published in the late 1990s by La Porta et al.; in addition, these features are compared with the characteristics of the mean English common law, German civil law and French civil law countries as well as those of the US, the UK and Germany. Spain showed an anti-director rights index of 4 over 6, a higher score than the mean French civil law countries (2.33) but...
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