As Pílulas de Veneno: Cláusulas em Estatutos Sociais de Empresas para Dificultar o Takeover Hostil

Nakao

2020

ASAA Journal

We examine whether the poison pills influence on the executive compensation of Brazilian publicly-traded firms, considering that there is a particularity of this anti-takeover device in Brazilian firms when compared to US firms, since the managers can include in the company's bylaws an "eternity" clause that prevents poison pills change or removal, which may lead to a managerial entrenchment, maintaining managers privileges in the detriment of minority shareholders, including increases in the executive compensation levels. To test our hypotheses, we use a sample of 217 Brazilian publiclytraded firms listed on B3 with available data on Bloomberg® database and Brazilian Securities Exchange Commission website between 2010 and 2017. We use the total, fixed and variable compensations as proxies for executive compensation. However, to mitigate several outliers of these variables, we use the quantile regression as a robust alternative to the extreme sensitivity of the ordinary least squares estimator to modest amounts of outliers. Our main results show that poison pills have a positive influence on total, fixed and variable executive compensation. Furthermore, in an exploratory way, our results show that these "eternity" poison pills also have a positive influence on these proxies of executive compensation. These findings are consistent with the entrenchment hypothesis that since managers are protected in their positions, they may obtain private benefits at the expense of shareholders, such as higher levels of executive compensation. In this sense, our study contributes to the literature by showing that although reducing the risk of a hostile takeover, the poison pills are incurring in an additional agency cost for shareholders that not always leads to the reduction of conflicts between managers and shareholders since these anti-takeover defenses seem not being adopted in the Brazilian context to benefit the shareholders, but to protect managers in their positions.

Section: Hypothesis Developmentmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

The Influence of Poison Pills on Executive Compensation

Nakao

2020

ASAA Journal

“…In this manner, this article fills a gap in studies that analyze poison pills within the Brazilian context, because despite the existence of evidence related to the theoretical-conceptual aspects and legal dispositions applicable to their adoption (Vieira et al, 2009), and their quantity and peculiarities in the Brazilian context (Ambrozini, Pimenta, & Gaio, 2015), as well as the effects of anti-takeover devices (Portulhak et al, 2017;Azevedo & Nakao, 2019), until now, this is the first study to investigate the aspects associated with the adoption of poison pills by Brazilian publicly-traded companies.…”

Section: Introductionmentioning

confidence: 99%

Poison pills e governança corporativa: um estudo no mercado acionário brasileiro

Gomes

Nakao

2021

Rev. contab. organ.

Este estudo tem por objetivo investigar se existe associação entre a adoção de poison pills e os níveis diferenciados de governança corporativa no mercado acionário brasileiro. A amostra é composta por 217 companhias abertas não-financeiras listadas na Brasil, Bolsa, Balcão (B3), com dados disponíveis ao longo do período 2010-2017. A análise de dados realizada por meio de regressões logit e probit evidencia que a adoção de poison pills está positivamente associada à listagem nos segmentos Novo Mercado e Nível 2 de governança corporativa. Assim, a adoção deste dispositivo anti-takeover por companhias que estão listadas nos níveis mais elevados de governança corporativa pode ser útil para atuais e potenciais investidores, ao passo que dado o aumento de companhias abertas com o capital predominantemente disperso no mercado acionário brasileiro, as tentativas de tomada de controle de forma hostil podem ser cada vez mais recorrentes. Além disso, os resultados contribuem teoricamente no sentido de uma possível convergência entre a Teoria da Sinalização e a adoção de poison pills, evidenciando que a adoção desse dispositivo anti-takeover como mecanismo complementar de governança corporativa pode representar um sinal de proteção emitido pelas empresas ao mercado visando a atração de novos investidores.

“…Brazil offers a unique setting to carry out our investigation because public firms could also adopt a specific type of poison pill (called “eternity” poison pills) that cannot be changed or removed (Ambrozini et al. , 2015), unlike “conventional” poison pills adopted by US firms, which are usually valid for a period of 10 years (Schepker et al.…”

Section: Introductionmentioning

confidence: 99%

“…Brazil offers a unique setting to carry out our investigation because public firms could also adopt a specific type of poison pill (called "eternity" poison pills) that cannot be changed or removed (Ambrozini et al, 2015), unlike "conventional" poison pills adopted by US firms, which are usually valid for a period of 10 years (Schepker et al, 2018). Hence, instead of preserving shareholders' rights and interests, as conceptually designed in the US context, poison pills appear to be adopted in the Brazilian context to perpetuate managers in their positions (Maestri, 2011), distorting its original purpose.…”

Section: Introductionmentioning

confidence: 99%

Stock price crash risk and the adoption of poison pills: evidence from Brazil

Schwarz²,

Dias³

et al. 2022

IJMF

PurposeThe purpose of this paper is to examine the effect of stock price crash risk on the adoption of poison pills.Design/methodology/approachThe authors estimate logit and probit regressions. Their sample includes 185 Brazilian public firms for the period 2010–2018. Following previous studies, the authors use the negative skewness of firm-specific weekly returns and the down-to-up volatility of firm-specific weekly returns as measures of firm's stock price crash risk. As proxies of poison pills, the authors employ the “conventional” poison pills in their baseline models and the “eternity” poison pills, which prevent the removal of poison pills from bylaws, in additional models.FindingsThe authors find that stock price crash risk measures are not associated with poison pill adoption. However, although stock price crash risk does not lead to poison pill adoption as a complementary corporate governance mechanism that protects firms against hostile takeover attempts, further results show that managers do not draw on stock price crash risk as a pretext to entrench themselves. Additional analyses also highlight that CEO power seems to play a role in moderating the relationship between stock price crash risk and eternity poison pill adoption.Originality/valueThe authors contribute to the literature on stock price crash risk, which calls for research in international contexts to better understand the effect of stock price crash risk on country-specific idiosyncratic features. The authors discuss a controversial anti-takeover mechanism that has been debated by Brazilian policymakers.