One decade of evolution of corporate governance practices in Brazil



Linha de Pesquisa
Administração e Economia de Negócios

Ricardo Pereira Câmara Leal, André L. Carvalhal, Ana Paula Iervolino



Revista Brasileira de Finanças, v. 13, n. 1, pp. 134–161. Abstract: This study presents theevolution of certaincorporate governance practices of listed Brazilian companies from 2004 to 2013 gathered in anindex(CGI).Results indicate that the overall quality of these practices improved, notablyafter the  creation of  voluntary  membership  exchange  trading  lists that  require better corporategovernanceand  disclosurepractices. The average CGI score of 5.8 (out of 10.0) in 2013 may be considered lowand points to the need for further improvement.  Moreover, firms score very low intheethics andconflicts of interest aspects of the CGI, whencompared toitsdisclosure, board composition andfunctioning, and shareholders rightscomponents. The very small number of firms that ban loans to related partiesand that facilitate participation in the shareholder   meetings   is   a   concern. The decreasein   the use   of   control enhancement   mechanisms, such   as   non-voting   shares   and   indirect   control structures,was  a  remarkable  achievement.  Even so,shareholder  agreements  are increasingly  used  as  instruments  tointerfere  with  director  independence  andleverage the controlling bloc power.

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