Corporate Governance and Responsible Investment in Private Equity

Private equity-backed businesses are increasingly prevalent, and their governance practices are a black box. This book lifts the lid.

Simon Witney (Author)

9781108725316, Cambridge University Press

Paperback / softback, published 7 July 2022

240 pages
22.9 x 15.2 x 1.3 cm, 0.33 kg

'… readers - especially regulators, company management, and investors - will find in this comprehensive text the answers to many of their questions regarding effective governance and responsible investment of private equity. Most will take the information provided as justification for their confidence in private equity–backed investing.' Janet J. Mangano, CFA Institute

Private equity-backed companies are ubiquitous and economically significant. Consequently, the corporate governance of these companies matters to all of us, and – not surprisingly – is coming under increasing scrutiny. Simon Witney, a practicing private equity lawyer, positions private equity portfolio companies within existing academic theory and examines the laws that apply to them in the UK. He analyses the actual governance frameworks that are put in place and identifies problems created by the legal rules – as well as the market's solutions to them. This book not only explains why these governance mechanisms are established, but also what they are expected to achieve. Witney suggests that private equity owners have both the incentives and the capability to focus on responsible investment practices. Good governance, he argues, is a critical success factor for the private equity industry.

Introduction
Part I. How Should Private Equity Governance Systems Look?: 1. Mapping an analytical framework
2. Private ordering in private equity and its implications
Part II. What Actually Happens?: 3. Agency cost mitigation
4. Improving decision-making and protecting wider interests
Part III. Corporate Governance Regulation in the UK and Private Equity's Response: 5. The relevance of business judgement regulation
6. Dealing with the duties to avoid and disclose conflicts of interest
7. Rules affecting the exercise of power by shareholders and their nominated directors
8. Recent corporate governance reforms, best practice codes and their impact
Part IV. How Governance Can Affect Corporate Performance: 9. How do academics explain private equity outperformance? 10. Improving governance to improve performance
Conclusion. Corporate governance and responsible investment
Bibliography
Index.

Subject Areas: Investment & securities [KFFM], Finance [KFF], Finance & accounting [KF], Economics, finance, business & management [K]