9.1 Anglo-American Model

The Anglo-American model of corporate governance is prevalent in countries like the United States and the United Kingdom. This model is characterized by a market-oriented approach with a focus on shareholder value.


Key Features

  • Shareholder Primacy: In this model, the primary objective of corporate governance is to maximize shareholder value. The interests of shareholders are given precedence over other stakeholders.

  • Board Structure: Companies typically have a unitary board structure, meaning there is a single board of directors composed of both executive and non-executive directors.

  • Dispersed Ownership: Ownership is usually dispersed among a large number of shareholders, which reduces the influence of any single shareholder.

  • Active Market for Corporate Control: There is an active market for corporate control, including hostile takeovers, which serves as a mechanism to discipline management.

  • Disclosure and Transparency: High levels of disclosure and transparency are emphasized to ensure that shareholders and the market have accurate information about the company’s performance.


Last modified: Friday, 18 October 2024, 12:38 PM