Last week, my colleague Geert Raaijmakers accepted his chair as professor of Corporate and Securities law at the VU University of Amsterdam with a public lecture called "Financial Markets and Corporate Law".
In the lecture, the good professor essentialy takes the position:
- that Dutch listed companies have become too dependent on financial markets in the last ten years;
- that, although it plays a disciplinary role towards the management of these companies (including supervisory directors), the market also has a number of limitations; and
- that what is needed is an agenda for change with an integral approach to the problems at three levels: the functioning of the market itself, the interaction between the market and companies and at the level of the companies.
As to these "limitations", he counts at least seven of them.
- inherent conflicts of interests;
- intransparant kongsi's;
- financial opportunism;
- irrational flock behavior;
- untransparent complexity;
- difficult to predict shapeshifts; and
- toughness of the markets.
Surely enough food for thought and recommended reading for anyone interested in the intersection between corporate law and securities law, but way too much to highlight in one post.
Fortunately, the full text of the lecture can be found here (unfortunately, Dutch only).
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