Newly privatised firms can often fall between the cracks, being at the same time more risky than SOEs and less profitable/competitive than private firms. A well-designed corporate governance regime is an important tool to make the transition period shorter and less painful. After reviewing the partially or wholly privatised European telecom sector, the paper proposes eight lessons for policy makers in charge of designing privatisation. First, where the State remains an important owner after partial privatisation, it should organise its shareholding function to pursue exclusively shareholder value objectives. Second, any privatisation-related asymmetries between control and cash-flow rights among shareholders should be limited in time and scope. Third, while some minority shareholder power, such as direct shareholder nomination and cumulative voting are welcome, the board needs to develop its own cohesiveness and culture. Fourth, the board should be actively and effectively involved in the development and validation of the company's strategy and the control of major transactions. Fifth, the privatised firms should strive to list in a market with high and credible disclosure requirements. Sixth, privatised firms should focus on developing a disclosure culture, especially as regards non-financial disclosure. Seventh, the board should conduct a regular, thorough and independent evaluation of the CEO, based on a set of criteria and yearly objectives agreed at the beginning of each exercise. Copyright Blackwell Publishing Ltd 2005.
Leo Goldschmidt's paper in this issue has focused on how boards address con¯icts of interest inherent in the corporate structure. He presented the general toolbox of corporate governance for addressing thesè dysfunctionalities' which are often linked to criminal behaviour within a corporation. This short paper addresses the speci®c mechanisms through which corporate governance impacts on economic crime, when perpetrated by corporate agents. These mechanisms are the products of an emerging framework of governance norms. While, in the past, speci®c legal rules dealing with corporations were largely the product of national legal orders, the emerging normative framework is global, in substance and increasingly in form. It is also market-based, shaped in global capital markets through the interaction of global investors and companies that sell products, employ labour and seek capital in many jurisdictions. The emergence, in less than ®ve years since their adoption, of the Organisation for Economic Co-operation and Development (OECD) Principles of Corporate Governance as a common language and blueprint for public policy eorts around the world testi®es to this globalisation of the normative framework for corporate governance.
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