PRÁTICAS DIFERENCIADAS DE GOVERNANÇA CORPORATIVA: UM ESTUDO SOBRE A CONDUTA E A PERFORMANCE DAS FIRMAS BRASILEIRAS

Abstract

This paper uses a sample of Brazilian firms in the period 1997 to 2001 to investigate the effectiveness of alternative corporate governance mechanisms. The data show that firms can commit to protect their minority shareholders by issuing Level II ADR' s or joining the Novo Mercado. In particular, firms with Level II ADRs and firms in the Novo Mercado have larger stock returns in times of turmoil, and they are more likely to pay dividends. The study shows, however, that changes in corporate law affect the ability of private contracts like ADRs to protect minority shareholders. As such, firms cannot completely overcome weaknesses in the Brazil's legal system that harm minority shareholders.