Research Robby Houben

Abstract

Short-termist behavior by corporations is considered a large societal problem. Many scholars have already argued that some investors are excessively focused on the short term, and that this short-termism is transmitted to corporate management through executive compensation and shareholder activists. However, most of the academic evidence has only studied the US and the UK, ignoring the specificities of corporate governance in continental Europe. Compared with the US and the UK, more corporations have a controlling shareholder in continental Europe, and shareholder activism and share-based executive compensation is rarer. So far, the academic evidence has not analyzed the implications of these differences in corporate governance. This has not stopped European jurisdictions from adopting measures to combat short-termism in corporate governance, for example by introducing loyalty voting rights. This research project analyzes the potential of corporate governance to discourage short-termism in two continental European jurisdictions, Belgium and France. It does so by reviewing the existing literature on short-termism in the US and the UK, comparing the US and the UK to Belgium and France, and providing new empirical evidence on Belgium and France. On the basis of this research, the proposals for corporate governance reform will be analyzed. This will help legislators and corporations take better informed decisions on combatting short-termism.

Researcher(s)

• Promoter: Houben Robby
• Co-promoter: Vos Tom

Research team(s)

• Business and Law

Project website

Project type(s)

• Research Project

Abstract

Flemish cities are expected to take a leading role in climate adaptation and mitigation strategies. At the core of these strategies are nature based solutions (NBS) by green, blue and hybrid urban infrastructures. NBS address multiple problems related to climate change in an integrated, sustainable way. Although investments in NBS infrastructures are considered a cost effective way to achieve future societal and environmental benefits, current public budgets in Flanders are insufficient. As a result, the gap between investments in and societal need for NBS is growing. In contrast to limited public budgets, there is an abundance of private capital seeking for investments. Yet, the potential to invest private capital in NBS is not fully exploited. NBS projects typically have sizeable upfront costs and diffuse and long-term societal benefits that are not easily captured in steady cash flows, making privately financed schemes often inappropriate. In order to attract private investments to NBS, new business models and alternative financing mechanisms are needed. In this project, we study the utilization potential of innovative financing models in the Flemish context by developing real life business cases of NBS, using new instruments such as impact financing, value capturing and ICO-crowd funding. In order to develop a realistic and holistic interdisciplinary approach, this strategic research will study how new financial instruments impact planning and design of NBS infrastructure. The urban living lab approach will ensure continuous integrated assessment of the spatial, juridical, institutional, economic feasibility and social impact of the new financing business models, optimising the utilisation potential for the societal users. This research project will be integrated in the SBO-FWO project Innofins if granted. The SEP grant will be used to finance the planning and design research track of the proposal and will finance a part time post doc to coordinate the living labs and to develop a new proposal for similar funding opportunities.

Researcher(s)

• Promoter: Houben Robby

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

Flemish cities are expected to take a leading role in climate adaptation and mitigation strategies. At the core of these strategies are nature based solutions (NBS) by green, blue and hybrid urban infrastructures. NBS address multiple problems related to climate change in an integrated, sustainable way. Although investments in NBS infrastructures are considered a cost effective way to achieve future societal and environmental benefits, current public budgets in Flanders are insufficient. As a result, the gap between investments in and societal need for NBS is growing. In contrast to limited public budgets, there is an abundance of private capital seeking for investments. Yet, the potential to invest private capital in NBS is not fully exploited. NBS projects typically have sizeable upfront costs and diffuse and long-term societal benefits that are not easily captured in steady cash flows, making privately financed schemes often inappropriate. In order to attract private investments to NBS, new business models and alternative financing mechanisms are needed. In this project, we study the utilization potential of innovative financing models in the Flemish context by developing real life business cases of NBS, using new instruments such as impact financing, value capturing and ICO-crowd funding. In order to develop a realistic and holistic interdisciplinary approach, this strategic research will study how new financial instruments impact planning and design of NBS infrastructure. The urban living lab approach will ensure continuous integrated assessment of the spatial, juridical, institutional, economic feasibility and social impact of the new financing business models, optimising the utilisation potential for the societal users. This research project will be integrated in the SBO-FWO project Innofins if granted. The SEP grant will be used to finance the planning and design research track of the proposal and will finance a part time post doc to coordinate the living labs and to develop a new proposal for similar funding opportunities.

Researcher(s)

• Promoter: Coppens Tom
• Co-promoter: Compernolle Tine
• Co-promoter: Crabbé Ann
• Co-promoter: Houben Robby
• Co-promoter: Van Dooren Wouter

Research team(s)

• Research Group for Urban Development

Project type(s)

• Research Project

Abstract

Tax competition between countries could involve tax incentives for legal entities and/or individuals. Also the football sector encounters many different tax and/or social security regimes between states. Since the Bosman case, football players have, in principle, the freedom to exercise their profession in the country of their choice. Domestic beneficial tax and/or social security regimes could play an important factor in their decision. European football clubs face a high burden to relocate their center of activities due to among others sporting obligations to compete mainly in their domestic competition, contractual obligations related to their stadium and local anchoring with traditional fan base. This does not mean that within the mid to long term football clubs could also take into account beneficial tax regimes for legal entities because of the growing globalization of the sport and an evolution towards the establishment of football holding companies. This study includes a comparative research on tax rates, pay roll taxes and social security charges of professional football clubs and professional players of the following countries: UK, France, Germany, Spain, Italy, Portugal, the Netherlands and Belgium. The aim is to come up with recommendations to level the playing field within the football sector. These findings can also be used for discussions on among others tax competition between states for high skilled workers.

Researcher(s)

• Promoter: Houben Robby
• Co-promoter: Van de Vijver Anne

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

The Jean-Pierre Blumberg Chair was established in 2021 in permanent memory of Jean-Pierre Blumberg. The activities of the chair consist of education, research and social engagement relating to the topic of corporate governance. Prof. Dr. Robby Houben is the holder of the chair. Dr. Tom Vos has been appointed as a researcher and visiting professor with the chair. In the academic year 2021-2022, Dr. Tom Vos will teach a course on 'short-termism or long-termism in the Belgian corporate landscape' in the context of the chair. The research agenda of the chair consists of research on the legal and economic aspects of corporate governance. More specifically, the chair has three lines of research: short-termism in corporate governance, start-up governance and shareholder protection in the issuance of shares.

Researcher(s)

• Promoter: Houben Robby

Research team(s)

• Business and Law

Project website

Project type(s)

• Research Project

Abstract

Numbers show that crypto-assets, including foremost virtual currencies, peaked at a market capitalisation of 650 billion EUR early 2018, drastically decreasing to about 96 billion EUR by early 2019 (source: ECB). These numbers indicate that, for now, virtual currencies are a marginal phenomenon from a financial stability and monetary policy perspective. They are not a marginal phenomenon, however, from the perspective of combating financial crime (tax fraud, money laundering, terrorist financing) or investor protection. For example, money laundering through virtual currencies is a real threat and fraudulent crypto investor schemes are also a reality, directly impacting domestic and European crime fighters, financial supervisors, investors, etc.. Moreover, realities can develop: it is not unlikely that larger projects, in particular the introduction of the Libra coin, a stable coin designed to facilitate payments, can take on monstrous proportions and truly compete with traditional fiat money – and thus impact financial stability and/or monetary policy in the future. In addition, it is reported that some states, including very large ones, are considering issuing central bank virtual currencies, in addition to traditional fiat money. These developments can have huge impact, also taking into account the digital nature of virtual currencies, making them susceptible to cybercrime, bringing cybersecurity to the table. The study addresses virtual currencies from a financial regulatory and compliance (with money laundering rules especially) perspective. It sets out the current European regulatory framework and how robust it is in view of the (potential) risks that crypto assets cause now, and are likely to cause in the future, taking into account recent developments such as Libra and government backed virtual currencies. It scrutinizes how the regulatory framework can be improved to tackle the identified risks/threats from a financial regulatory and compliance perspective, insofar the current framework would prove insufficient.

Researcher(s)

• Promoter: Houben Robby

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

During the European sovereign debt crisis, as from 2009, various Eurozone countries faced difficulties either to repay or refinance their outstanding debt and/or to rescue banks hit by the preceding financial crisis. Both European (including the European Stability Mechanism (ESM) and the European Central Bank (ECB)) and international institutions (the International Monetary Fund (IMF)) had to step in to bail-out countries including Greece, Ireland & Portugal and avoid sovereign default. Our research focusses on regulatory initiatives with regard to "responsible sovereign lending & borrowing", a well-known concept in the context of household debt that yet received relatively little academic attention with regard to sovereign debt. After 1) investigating the rationale for regulation (the "why" of regulation), based amongst others on a (behavioural) law analysis (e.g. taking into account existing market failures) and a comparison with lender/borrower liability rules applicable to household & commercial credit, as well as 2) the various regulatory options (the "how"), we focus in particular on proposals for sovereign debt restructuring mechanisms (so called "SDRMs"). SDRMs (e.g. automatic write-downs/maturity extensions of sovereign debt) could for instance enter into force in case a Eurozone country applies for a bail-out with the ESM. Considered as "one of the preconditions for a stronger Banking Union" , SDRMs prove highly controversial on the EU political level.

Researcher(s)

• Promoter: Houben Robby
• Fellow: Klamo Adam

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

The past decades we have seen a clear trend towards professionalization of Belgian football clubs. With some exceptions, the structure of Belgian football clubs is moving towards that of "regular" mid-size to large corporates. Illustrative is the conversion of numerous football clubs from associations to companies, especially NVs (limited liability company), allowing a more suitable governance structure and more flexible financing options. Also illustrative is that successful entrepreneurs find their way to the shareholding and directorship of Belgian football clubs. Notwithstanding this clear trend towards professionalization and the return of certain prominent players of the Belgian national team to the Jupiler Pro League, Belgian football clubs are not yet at the forefront of European football. With some exceptions over the years, Belgian football clubs generally have difficulties to compete consistently at the highest level, especially the Champions League, but also the Europa League. On another note, the trend towards professionalization has not safeguarded Belgian football clubs against recent turmoil relating to match fixing, money laundering and tax evasion, with certain football brokers as linchpins. This turmoil very well illustrates that football clubs do not operate outside a legal and regulated environment and that compliance with laws and regulations is key. The further professionalization of football clubs should acknowledge this simple truth and clubs should be organized in the best possible way so as to assure compliance with laws and regulations. In light of the above, the research intends to identify best practices as regards governance, including compliance, of the Belgian football enterprise and to provide policy advice towards the Belgian rule maker(s) so as to further develop the regulatory framework wherein Belgian football clubs operate.

Researcher(s)

• Promoter: Houben Robby

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

More and more regulators are worrying about criminals who are increasingly using cryptocurrencies for illegitimate activities like money laundering, terrorist financing and tax evasion. The problem is significant: even though the full scale of misuse of virtual currencies is unknown, its market value has been reported to exceed €7 billion worldwide. This paper commissioned by Policy Department A for Economic, Scientific and Quality of Life Policies of the European Parliament elaborates on this phenomenon from a legal perspective, focusing on the use of cryptocurrencies for financial crime, money laundering and tax evasion. It contains policy recommendations for future EU standards.

Researcher(s)

• Promoter: Houben Robby

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

The new architecture for prudential supervision intends to bolster financial stability. A twofold legal structure was introduced: the micro dimension considers the supervision of individual credit institutions and is managed by the ECB (for significant banks); the macro dimension focusses on imbalances in the financial system and is handled at national level. However both dimensions are strongly interconnected. This research envisages a critical analysis elucidating the dynamic interplay between micro- and macro-prudential supervision to foster a coherent approach by authorities at both EU and national level. The research is conducted primarily from a legal perspective, but is embedded in the economic context and will build on economic realities.

Researcher(s)

• Promoter: Houben Robby
• Co-promoter: De Ceuster Marc
• Co-promoter: Vanmeenen Melissa
• Co-promoter: Vanneste Jacques

Research team(s)

• Business and Law

Project type(s)

• Research Project

Abstract

As of the beginning of April 2016, the International Consortium of Investigative Journalists, together with numerous reporting partners from around the world, started revealing more than 214,000 offshore entities, connected to people in more than 200 countries and territories, including EU Member States. These revelations are known as the Panama Papers, following the origin of the information on which they are based: a massive leak of offshore financial records from a Panama based law firm. The Panama Papers exposed that often offshore entities were set up as shell companies, without a real underlying economic rationale or substance within the country where they were set up, to hide the true ownership or origin of the assets held by it, under which money held on banks accounts around the world, including the EU. Following the revelations set out in the Panama Papers, the European Parliament decided on 8 June 2016 to set up a special Committee of Inquiry to investigate alleged contraventions and maladministration in the application of Union law in relation to money laundering, tax avoidance and tax evasion. This research intends to serve as a preparatory document for the Committee of Inquiry's investigation and elaborates on the content and limits of its mandate.

Researcher(s)

• Promoter: Houben Robby

Research team(s)

• Business and Law

Project type(s)

• Research Project