Controlling shareholders maximize private benefits through strategic investments and legal protection.
The article explores how controlling shareholders benefit from their power over a company's decisions. By studying different factors like cash-flow rights and legal protection, the researchers found that controlling shareholders aim to maximize their long-term benefits, not just short-term gains. They also discovered that the level of control a shareholder has and the legal safeguards in place can impact how much they can benefit from their position. Overall, the study shows that controlling shareholders are strategic in their actions to secure the most private benefits possible.