Formas De Gobierno

Governance

Governance refers to "all processes of governing, whether undertaken by a government, market, or network, whether over a family, tribe, formal or informal organization, or territory, and whether through laws, norms, power, or language."[1] It relates to processes and decisions that seek to define actions, grant power, and verify performance.

In general terms, governance occurs in three broad ways:[citation needed]

1. Through networks involving public-private partnerships (PPP) or with the collaboration of community organisations;

2. Through the use of market mechanisms whereby market principles of competition serve to allocate resources while operating under government regulation;

3. Through top-down methods that primarily involve governments and the state bureaucracy.

To distinguish the term governance from government: "governance" is the concrete activity that reproduces a formal or informal organization. If the organization is a formal one, governance is primarily about what the relevant "governing body" does. If the organization is an informal one, such as a market, governance is primarily about the rules and norms that guide the relevant activity. Whether the organization is a geo-political entity (nation-state), a corporate entity (business entity), a socio-political entity (chiefdom, tribe, family, etc.), or an informal one, its governance is the way the rules and actions are produced, sustained, and regulated.

Public governance

Private governance

Global governance

Non-profit governance

Corporate governance

Project governance

Environmental governance

Internet governance

Information technology governance

Regulatory governance

Participatory governance

Good governance is an indeterminate term used in international development literature to describe how public institutions conduct public affairs and manage public resources. Governance is "the process of decision-making and the process by which decisions are implemented (or not implemented)".[1] The term governance can apply to corporate, international, national, local governance[1] or to the interactions between other sectors of society.

The concept of "good governance" often emerges as a model to compare ineffective economies or political bodies with viable economies and political bodies.[2] The concept centers around the responsibility of governments and governing bodies to meet the needs of the masses as opposed to select groups in society. Because the governments treated in the contemporary world as most "successful" are often liberal democratic states concentrated in Europe and the Americas, those countries' institutions often set the standards by which to compare other states' institutions when talking about governance.[2] Because the term good governance can be focused on any one form of governance, aid organizations and the authorities of developed countries often will focus the meaning of good governance to a set of requirement that conform to the organization's agenda, making "good governance" imply many different things in many different contexts.

Abstract

The main objective of this paper is to describe the essential features of large Mexican firms. The observed structure fits with the stylized facts of the business groups found in many developing countries. Firstly, there is a high concentration of control rights, not only because family members own large holdings of stock in these firms, but also because it is a common practice to use pyramids and to issue “no-voting” shares. Secondly, there seems to remain a high degree of integration and diversification, despite the recent developments in the Mexican financial markets and the increased competition observed in product and input markets. Thirdly, banks and other financial institutions affiliated with groups are still important conduits for channeling external financing, as can be seen by analyzing the financial information of firms quoted on the stock exchange.

Introduction

The corporate governance of most large firms in Latin America has been traditionally organized as business groups.1 These BGs are conglomerates owned and controlled by families or closed groups of investors. Each network of firms presents vertical and horizontal links, and thus the consortium takes advantage of economies of scale or scope, reduces transaction costs, earns monopolistic profits and diversifies risk by undertaking production in different economic activities. Cross shareholding among associated entrepreneurs and the exchange of positions in the board of directors are also characteristic features. Moreover, it is common to find that banks and other financial institutions are part of a BG.

The BG is typical of countries where financial markets are poorly developed, and where public offerings constitute a small percentage of the total capital of the firm. Some economists argue that business groups are the result of poor legal systems, where rights of minority shareholders and small creditors are scarcely protected. 2 The existence of large investors creates a vicious circle that hinders capital markets. This is so because rent expropriation capabilities of controlling shareholders reduce the interest of minority participation.

The objective of this paper is to describe the main features of large Mexican firms, in order to establish if the observed structure fits with some of the stylized facts of the BGs defined above. The rest of the article is organized as follows: In the second section, some data is reviewed to show the nature of the control rights in the Mexican business groups (MBGs). In the third section an empirical analysis is made to see how integrated and diversified the modern MBGs are, while some of their banking linkages are reviewed in the final section.

2.- Concentration of control in Mexican public firms The purpose of this section is to show that even in large Mexican firms, there is a high concentration of control rights,3 not only because of the fact that family members own large holdings of stock in these firms, but also because it is common to issue

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