4004375: Corporate governance in the financial services industry

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Semester:WS 15/16
Scheduled in semester:3
Semester Hours per Week / Contact Hours:6.0 L / 4.5 h
Self-directed study time:40.5 h

Module coordination/Lecturers


Master's degree programme in Banking and Financial Management (01.10.2008)


  • Role and Responsibility of Owners
  • Practice of Right of Control for Various Actors
  • The Problem of Free Riding
  • Major Investors
  • Conflicts of Interest Between Financiers
  • Conflicts of Interest Between Stakeholders
  • Financial Remuneration of Managers
  • Alternative Designs for Option-Based Remuneration Structures for Managers
  • Role and Responsibility of Institutions (Accounting, State)
  • Corporate Governance in Financial Services Undertakings
  • Optimal Design for Corporate Governance
  • Empirical Investigations of Corporate Governance

Lecture Goals

  • Illustrating role and responsibility of owners
  • Explaining right of control
  • Describing problem of free riding
  • Identifying the special characteristic of major investors
  • Describing conflicts of interest
  • Scrutinising methods of remuneration of managers
  • Describing and critically evaluating differing designs for option-based remuneration structures regarding their effect
  • Demonstrating role and responsibility of boards or of the state
  • Explaining the special characteristics of Corporate Governance in financial services undertakings
  • Developing optimal corporate governance structures
  • Contrasting empirical investigations of Corporate Governance



Required reading:

  • Dittmann, I. /Maug, E. (2007). Lower Salaries and no Options: The optimal Structure of Executive Pay. In: Journal of Finance.

Recommended reading:
  • Van dem Brink, J. /Romeike, F. (2005). Corporate Governance und Risikomanagement in Finanzdienstleistungsbereich. Stuttgart: Schaeffer-Poeschel.
  • Menichetti, M. J. (1999). Anreizeffizientes Design von Executive Stock Options. In: Egger, A. /Grün, O. /Moser, R. (Hrsg.) (1999). Managementinstrumente und Konzepte, Stuttgart: Schäffer-Poeschel, pp. 511-527.


Lecture slides will be available on Moodle

Exam Modalities

  • Obligatory class participation and written exam (this lecture covers 30 minutes) (10%)


31.10.201509:00 - 13:45H4