4408110: Corporate Governance

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Semester:WS 17/18
Scheduled in semester:3
Semester Hours per Week / Contact Hours:28.0 L / 21.0 h
Self-directed study time:69.0 h

Module coordination/Lecturers


Master's degree programme in Finance (01.09.2015)


  • 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
  • The role of Risk Management in Corporate Governance

Lecture Goals


  • illustrate the role and responsibility of corporate owners
  • explain the right of corporate control
  • describe the problem of free riding
  • identify the special characteristic of major investors
  • describe conflicts of interest
  • scrutinise methods of remuneration of managers
  • describe and critically evaluate differing designs for option-based remuneration structures regarding their effect
  • demonstrate the role and responsibility of the board of directors, a company’s audit committee and the state
  • explain the special characteristics of Corporate Governance in the undertakings of financial services
  • develop optimal Corporate Governance structures
  • contrast empirical investigations of Corporate Governance
  • compare and contrast best practices in corporate governance with those of risk management
  • evaluate the relationship between a firm’s risk appetite and its business strategy
  • distinguish the different mechanisms for transmitting risk governance throughout an organization
  • illustrate the interdependence of functional units within a firm as it relates to risk management


Lectures Method

Interactive lecture, cases and discussion.


Required reading:

  • Brinsley, N. (2006). Executive Stock Options: Early Exercise Provisions and Risk-taking Incentives. The Journal of Finance, 61(5), 2487–2509.
  • Crouhy, M., Galai, D., & Mark, R. (2014). The Essentials of Risk Management (2nd ed.). New York: McGraw-Hill. [Chapter 4]
  • Dittmann, I. & Maug, E. (2007). Lower Salaries and no Options: The optimal Structure of Executive Pay. The Journal of Finance, 62(1), 303-343.
  • Hall, B. J., & Murphy, K.J. (2003). The Trouble With Stock Options. Journal of Economic Perspectives, 17(3), 49-70.
  • Hall, B. J., & Murphy, K. J. (2002). Stock options for undiversified executives. Journal of Accounting and Economics, 33(1), 3-42.
  • Monks, R.A.G., & Minow, N. (2011). Corporate Governance (5th ed.). Chichester: Wiley.
  • Rezaee, Z. (2008). Corporate Governance and Ethics. London: Wiley.


Lecture slides will be available on Moodle

Exam Modalities

Written exam (60 minutes)


12.09.201713:15 - 16:30H5 (Fabrikweg)
12.09.201713:15 - 16:30abgesagt/cancelled
19.09.201713:15 - 16:30H5 (Fabrikweg)
28.09.201713:15 - 16:30H5 (Fabrikweg)
05.10.201713:15 - 16:30S2
10.10.201713:15 - 16:30H5 (Fabrikweg)
26.10.201713:15 - 16:30abgesagt/cancelled
28.10.201709:00 - 12:15H2
02.11.201713:15 - 16:30abgesagt/cancelled
21.11.201713:15 - 16:30H6 (Fabrikweg)
28.11.201713:15 - 16:30S3


  • PWW-MA_Corporate Governance (WS 17/18, bewertet)
  • PWW-MA_Corporate Governance (SS 18, bewertet)