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Protecting Minority Investors

Protecting Minority Investors: Achieving sound corporate governance

Investment is key to private sector development. Doing Business, through the protecting minority investors indicator set, measures aspects such as the protection of shareholders against directors’ misuse of corporate assets for personal gain and the rights and role of shareholders in corporate governance. The legal implications of shareholder empowerment have been studied extensively.

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Protecting Minority Investors: Achieving sound corporate governance

Investment is key to private sector development. Doing Business, through the protecting minority investors indicator set, measures aspects such as the protection of shareholders against directors’ misuse of corporate assets for personal gain and the rights and role of shareholders in corporate governance. The legal implications of shareholder empowerment have been studied extensively.

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Protecting minority investors: Going beyond related-party transactions

Since their inception, the Doing Business indicators on protecting minority investors measure minority shareholder protections against directors’ misuse of corporate assets for personal gain. This is done by positing specific sets of assumptions about a related-party transaction between 2 companies that involves a clear conflict of interest. Doing Business introduces 3 new measures that are unrelated to this transaction, covering a broader array of regulations that are conducive of capital market investment and that promote greater access to finance for entrepreneurs.

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Celebrating reforms

Mexico: Protecting investors from self-dealing

In 2004 Mexico’s securities market was a tiny fraction of what might be expected for an economy of its size. And while Latin America received 9% of global private equity flows, Mexico, with more than a third of the region’s income, received only a tenth of that. More companies were delisting rather than issuing new shares on the Mexican stock exchange. It was time for reform.

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Celebrating reforms 2008

Vietnam: Protecting minority shareholders to boost investment

Investors used to be afraid to put their money in Vietnam. Why? Fear that company management would misuse funds for personal benefit. The previous laws lacked clear rules for transparency and directors’ obligations. And the regulatory system governing companies was fragmented and opaque.

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Celebrating reforms 2009

Albania: Seizing the opportunity for effective legal reform

In 2006-2007, Albania’s government, legal, and business communities all felt the need for a new commercial legal framework. To this end, Albania’s government, in 2008, passed a company law designed to make a difference in the long term.

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