Abstract
Abstract This article aims to identify the changes in corporate governance associated with the life cycle of companies. It is guided by the research problem of understanding what effects the maturity of the business has on its ownership structure, corporate relations, and other governance configurations. The study used longitudinal analysis of the changes that occurred in Transportadora Brasileira Gasoduto Bolivia-Brasil SA (TBG), a privately held company controlled by Petrobras Logística de Gás, with the participation of several state and private partners. The data were collected through document analysis and interviews with executives. The results identified the relationship between the stages of the business and the characteristics of the investors, ranging from an initial moment built around energy companies specialized in the business to the maturity phase when the investment became interesting to capitalist partners interested in financial results. In addition, planning before capital consolidation, the existence of a financing structure, clear criteria for selecting partners, and the presence of a second relevant shareholder, mitigates any problems of abuse of power or non-compliance with established rules, contributing to preserving the relationship between shareholders over time and the sustainability of corporate agreements. The study contributes to a new perspective on the analysis of corporate governance, considering necessary changes and adaptations over time and reflections on the corporate structures and priorities of the governance actors.
Highlights
The development of corporate governance has been marked by the quest for minimising conflicts between shareholders and executives
The various ownership changes and strategic reconfigurations that Transportadora Brasileira Gasoduto Bolívia-Brasil SA (TBG) went through in the years following its foundation motivated the choice of this company for the study. In this sense, adapting the line followed in a previous study by Thomsen (2004), we examine changes throughout the company’s life cycle in three governance mechanisms: its ownership structure, the composition of the board and the influence of shareholders
A documentary research was carried out collecting and analysing material publicly disclosed by the company, describing its processes and considerations of shareholders and other organisations such as the World Bank and other governments, to understand the changes that occurred in the business environment, shareholders’ strategic objectives, shareholding structure, and the governance mechanisms implemented by TBG
Summary
The development of corporate governance has been marked by the quest for minimising conflicts between shareholders and executives. One case representing a landmark in the conflict between shareholders and management interests is Texaco, in 1984. The company’s executives, knowing that a group of investors were willing to purchase stocks to increase their ownership and take over the company’s control, decided to use the company’s resources to buy the investors’ stocks paying US$ 137 million premium over the market price, an option that was not given to the other shareholders. The executives avoided losing control of the company, without involving the other shareholders in the decision making (Monks & Minow, 2011). This case showed that executives were more concerned about holding their positions than with shareholders’ interests
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