ABSTRACT
This chapter discusses the corporate governance practices in three systems: the US, Japanese and the EU systems. It explores the three influential securities markets, to provide a comparative discussion on the securities regulations and practice in these systems. The chapter demonstrates how the securities market is at work in exerting its corporate control function. Corporate governance generally classify systems of corporate governance into two classical types, "market based" and "bank based", based on ownership structure. For instance, whereas the US and UK models of corporate governance are treated as typical market-based models, the German and Japanese models of corporate governance are regarded as bank-based models. The US federal government has extensively exercised its regulatory power to improve corporate governance through market control. Promoting sound corporate governance has also been an important task of the SEC. Both the securities legislation and the SEC have the objective of promoting good corporate governance through effectively regulating disclosure, board independence and auditing.
