This paper explores the interrelationships among corporate culture, capital structure, firm performance, and fiduciary duties. Chaos theory, nonlinear dynamics, complex systems theory, and socio-cultural studies of firms’ organizational ecosystems, and enabling infrastructure suggest that the BCE rule is: (i) a superior fiduciary principle to shareholder primacy; and (ii) more likely to enhance firm value in proportion to the importance of intangible assets in its production process. The existence of “epistatic costs” rooted in the non-linear negative feedback effects of perverse agency theory-driven cost cutting is hypothesized. A theoretical model is developed to empirically test for the existence of epistatic costs and optimal levels of organizational tension or “slack.” Broader implications of the model for fiduciary rules, financing decisions, and the current posture of Canadian securities regulation in the takeover context are explored.

This paper explores the interrelationships among corporate culture, capital structure, firm performance, and fiduciary duties. Chaos theory, nonlinear dynamics, complex systems theory, and socio-cultural studies of firms’ organizational ecosystems, and enabling infrastructure suggest that the BCE rule is: (i) a superior fiduciary principle to shareholder primacy; and (ii) more likely to enhance firm value in proportion to the importance of intangible assets in its production process. The existence of “epistatic costs” rooted in the non-linear negative feedback effects of perverse agency theory-driven cost cutting is hypothesized. A theoretical model is developed to empirically test for the existence of epistatic costs and optimal levels of organizational tension or “slack.” Broader implications of the model for fiduciary rules, financing decisions, and the current posture of Canadian securities regulation in the takeover context are explored.

Introduktion: Blankning är ett sätt för en investerare att tjäna på att bolagets aktiekurs faller och har anklagats för att vara bakomliggande orsak till flera finansiella kriser. Det finns olika anledningar till att ett bolag blankas, likaså kan ett bolag påverkas av blankningen på olika sätt. Den befintliga forskningen behandlar främst den amerikanska marknaden och de tekniska åtgärder bolagen utövar för att minska blankning. Därmed finns det en lucka i forskningen kring huruvida svenska bolag verkställer strategier eller inte för att mildra blankning.   Syfte: Syftet med studien är att undersöka om svenska bolag verkställer strategier för att motverka blankningsnärvaro och förstå varför bolag har valt att styra på ett visst sätt vid en blankningssituation. Metod: Studien genomfördes med en kvalitativ forskningsansats och nyttjar empirisk såväl som teoretiskt material för att kontrastera den teoretiska referensramen med upptäckter i den empiriska data. Den primära datainsamlingen utgörs av semistrukturerade intervjuer med fyra av de femton mest blankade bolag enligt Finansinspektionen för april 2021 där analysering av den empiriska data har följt en trestegsprocess bestående av beskrivning, systematisering och kombination.   Slutsats: Studien har visats sig att de fyra bolag som har intervjuats inte sysslar med aktiva strategier mot blankning eftersom det finns en överensstämmande bild bland bolagen att det ska vara en fri marknad och att aktörerna får ta egna beslut. Resultatet visar att de svenska bolagen fokuserar på det långsiktiga tillväxt och att bibehålla transparens gentemot marknaden som i slutändan ska rättfärdiga deras värdering. / Introduction: Short selling is a way for an investor to gain profit when a stock drops in price and the practice has been accused of being the reason behind several financial crises. There are various reasons why a company gets shorted, which affects the company in many ways. Previous studies have only processed short selling in the US market and technical actions that companies enforce to reduce short interest. However, there is a lack of studies about the Swedish market and strategies, if any, that Swedish companies work with to reduce short interest. Purpose:  The purpose of this study is to examine whether Swedish firms execute strategies or not to counteract the presence of short selling positions and understand why the firms have chosen to manage in a certain way during a short selling situation.  Method: The study was conducted with a qualitative approach and uses both empirical and theoretical material to contrast the theoretical framework with the discoveries from empirical data. The primary data collection consists of semi-structured interviews with four out of the fifteen most shorted companies according to Finansinspektionen for April 2021, whereas the data was analyzed using the three-step process consisting of description, systematisation, and combination. Findings: The study shows that the four firms interviewed do not actively work with strategies against short selling as there is a consensus amongst the firms that the market should operate freely and that the participants make their own decisions. The result shows that the Swedish firms focus on the long-term growth of the company and to maintain transparency towards the market which in the end should justify their valuation.

Could shareholder primacy, with its assumed short-termist practices, have had its day when it comes to managerial activity centered on creating corporate value? Many business and opinion leaders appear to take this position, not least Jack Welch who famously declared 'shareholder primacy is the dumbest idea in the world!' Indeed, in a post-Crash economy has a wider stakeholder focus with a longer-term outlook superseded any business notions of shareholder primacy and wealth maximization? This research examines these possibilities through a consideration of the narrative companies produce, such as annual reports. From this corpus material, an assessment is made of whether UK managers' perceptions about corporate value generation changed over the period covering the worldwide financial crisis, with respect to their relative favouring of shareholders and stakeholders. The corpus of narrative material used is visualized as a conceptual space in which a conversation reflecting perceptual bias to the generation of corporate value occurs. To explore such corpuses, in order to compare narratives at points either side of the 2008 Crash, a new methodology was devised called narrative staining. Hence, a detection and visual mapping over the period was made possible of managers' changing perceptions concerning primacy (shareholder or stakeholder orientation) with its mediation by termism (a short or long-term bias). Termism is also originally conceived as part of a larger temporal category, which includes a sense of urgency to act (urgent versus non-urgent) that is similarly examined. The investigation reveals that over time perceptual change about value creation happened, though in unanticipated ways. Companies pre-Crash were often short-term stakeholder oriented then moved post-Crash to a long-term shareholder orientation. A focus for this study was the corporate domain, consisting of a selection of FT250 companies. However, managerial perceptions about corporate value creation are influenced not simply by the conversation of the corporate domain but rather by a multi-actor conversation taking place throughout the business environment. To comprehend this effect, the research mines further corpuses that comprise the UK's regulatory domain (hard and soft law), the press (Financial Times and other newspapers), and relevant peripheral stakeholder organizations (including the Confederation of British Industry, the Institute of Directors, and the Trades Union Congress). These organizations demonstrated more complex, unforeseen, perceptual effects as the financial crisis proceeded with many aligning according to their political or business agenda, which also impacted any sense of urgency to act they had. There appears to be no previous attempt at an extensive and multivariate analysis of this nature. And the findings challenge prevalent characterizations of shareholder and stakeholder behaviour. Moreover, the research shows that utilizing a wide set of stakeholder corpuses acts a viable proxy for broader financial perspectives amongst UK organizations. The technique of narrative staining therefore provides insights, hitherto inaccessible, for assessing and consolidating large-scale perceptual bias regarding value creation across the economy. The technique also has significant potential for other applications.

This thesis investigates the current interrelationship between the provisions contained in the Swedish Company Act (2005:551) and activities related to Corporate Social Responsibility (CSR) pursued by companies listed at Nasdaq Stockholm. The focal point of this thesis could be argued to be of particular relevance in this day and age, as companies listed at Nasdaq Stockholm continue to perform at the top of the league in global sustainability performance measurements, and Swedish and European legislators have intensified their efforts to encourage businesses to operate in a way that does not incur unacceptable social costs to society. Thus, most companies, particularly those with a vested interest in the private consumer market, seem to recognise the importance of fostering long-term relationships with a wide sphere of stakeholders. The purpose of the thesis has been to contribute to the steadily increasing body of legal research that discusses to what extent Swedish companies, without breaching corporate law, could involve themselves in CSR investments. Since I, initially, conclude that Swedish publicly listed companies seem to increasingly invest in activities related to CSR, the thesis also discusses whether the relevant provisions of the SCA need to change to better adapt to companies’ involvement in CSR activities. In brief, I argue, that current business research on CSR coupled with the aforementioned relevant provisions of the SCA allow boards and managing directors to pursue practically any CSR investments, and that shareholders are mostly restricted to rely on relatively blunt ex post actions against a board and/or managing director that has pursued an ill-considered CSR investment, including the obvious choices of voting to replace the board or selling their shares. And since current business research has not consistently proven the positive impact of CSR policies on the financial performance of businesses there are reasons to suspect that the law practically, due to the shielding force of the business judgment rationale and the legislator’s wish to protect most transactions, cannot be effectively applied to stop CSR investments, even if these are nothing but costs for the business. On the other hand, the findings of the thesis also suggest that the occurrence of such unwise CSR investments is not necessarily a proliferating problem, since many companies listed at Nasdaq Stockholm nowadays have powerful and short-sighted institutional owners. The situation might therefore very well be the opposite and that executives struggle to manage for the long-term, as the logic of the market tell them to do otherwise. / Den här examensuppsatsen utforskar förhållandet mellan några av aktiebolagslagens regler och det engagemang som bolag noterade på Nasdaq Stockholm uppvisar i frågor rörande Corporate Social Responsibility (CSR). Ämnet kan sägas vara särskilt relevant då såväl det samtida näringslivet som lagstiftaren tycks präglas av en ökad medvetenhet kring CSR-frågor. Den ökade medvetenheten i näringslivet förefaller alltmer inverka på affärsbeslut, ett faktum som inte minst avspeglas i de svenska bolagens topplaceringar i globala index som mäter bolags arbete med hållbarhetsfrågor. Samtidigt speglas lagstiftarens ökade medvetenhet av allt fler svenska som europeiska regulatoriska initiativ på området och vars yttersta syfte är att uppmuntra och stimulera hållbara företag som inte pådyvlar samhället oacceptabla sociala kostnader. Det är således inte särskilt anmärkningsvärt att bolagen, i synnerhet de med intressen anknutna till konsumentmarknaderna, tycks erkänna vikten av att bygga och underhålla långsiktiga relationer med en vidare krets av intressenter än deras aktieägare. Det är min förhoppning att den här uppsatsen kommer att bidra till den ständigt växande del av den aktiebolagsrättsliga diskursen som diskuterar till vilken grad bolag, utan att handla i strid med ABL:s bestämmelser, kan företa åtgärder kopplade till CSR. Eftersom jag inledningsvis anför att bolagen på Nasdaq Stockholm tycks ägna sig allt mer åt CSR diskuterar också uppsatsen om några av ABL:s bestämmelser bör förändras för att bättre hantera dessa företags allt större engagemang i CSR-frågor. Sammanfattningsvis argumenterar jag för att nuvarande företagsekonomisk forskning kring CSR tillsammans med de aktuella bestämmelsernas juridiska innebörd innebär att såväl bolagsstyrelser som verkställande direktörer kan företa i princip vilken investering relaterad till CSR som helst. Aktieägare är i praktiken hänvisade till att söka åstadkomma långsiktigt lönsamma satsningar på hållbarhet genom sanktioner ex post, exempelvis genom att sälja sina aktier eller rösta bort styrelsen. Detta innebär å ena sidan i praktiken, med tanke på att nuvarande företagsekonomisk forskning kring CSR:s inverkan på bolags vinster är tvetydig, att de relevanta bestämmelserna i ABL såsom de nu är utformade utgör en trygg hamn även för många av de transaktioner relaterade till CSR som är direkt värdeförstörande. Å andra sidan argumenterar jag i uppsatsen för att problemet med överinvesteringar i CSR inte nödvändigtvis behöver vara särskilt utbrett då bolagen och deras bolagsstyrning allt mer kommit att präglas av kortsiktiga investeringsperspektiv.