Private equity firms, such as Blackstone and Kohlberg Kravis Roberts & Co., search for firms where the managers appear not to be maximizing profits. A private equity firm can buy stock in these firms and have its employees elected to the firms' board of directors and may even acquire control of the targeted firm and replace the top management. Do private equity firms improve corporate governance?

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Business

18 February, 08:54

Private equity firms, such as Blackstone and Kohlberg Kravis Roberts & Co., search for firms where the managers appear not to be maximizing profits. A private equity firm can buy stock in these firms and have its employees elected to the firms' board of directors and may even acquire control of the targeted firm and replace the top management. Do private equity firms improve corporate governance?

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Keaton Conway · Answer 1

Answer and Explanation:

private equity firms have the aim of investing in the company's private equity to earn profits. so apart from policies and rules that are an important check towards fiscal management, equity firms also play an important role in regulating the company's management.

Therefore, The private equity firms improve corporate governance.