Showing papers in "Corporate Governance in 2010"
TL;DR: In this paper, the authors investigate the impact of governance on information asymmetry between managers and investors and find that some formal monitoring attributes (board and audit committee size) as well as the extent of voluntary governance disclosure reduce information asymmetric.
Abstract: Purpose – The purpose of this paper is to investigate the impact of governance on information asymmetry between managers and investors. Hence, the paper seeks to extend prior voluntary disclosure research.Design/methodology/approach – The paper investigates how a firm's governance maps into the level of information asymmetry between managers and investors. Governance encompasses two complementary dimensions: formal monitoring attributes and voluntary disclosure about board processes. Information asymmetry is measured by either share price volatility or Tobin's Q.Findings – The results show that some formal monitoring attributes (board and audit committee size) as well as the extent of voluntary governance disclosure reduce information asymmetry. This suggests that governance disclosure may complement a firm's governance monitoring attributes, especially in a country such as Canada where investors have good legal protection. It appears also that firms take into account ultimate costs and benefits to shareh...
177 citations
TL;DR: In this article, a regression analysis of the variables CSR and EPS, a very weak (causal) but positive relationship was evident (R2=0.147) between the two variables.
Abstract: Purpose – This paper attempts to prove that strategically investing in corporate social responsibility (CSR) will maximize profits while satisfying the demands from multiple stakeholders.Design/methodology/approach – The paper adopts a quantitative analysis and exploratory approach. It studies the CSR practices of 20 selected UK companies. The analysis of CSR policies is based on the global reporting initiative (GRI) guidelines. The analysis took a further step in examining the trends of earnings per share (EPS) of the selected companies.Findings – The findings revealed that out of the 20 selected companies, only four achieved all six guidelines as per the GRI. In regression analysis of the variables CSR and EPS, a very weak (causal) but positive relationship was evident (R2=0.147).Research limitations/implications – The study was applied to 20 selected companies in the UK. Future research should be extended to a larger sample in order to analyze the strength of the relationship between EPS and CSR. The s...
120 citations
TL;DR: In this paper, the authors explore how stakeholders are voluntarily granted influence in corporate decision making, and find that stakeholders are granted a voice regarding operational, managerial as well as strategic issues, and the power granted to stakeholders varies from non-participation to co-decision making.
Abstract: Purpose – This paper aims to explore how stakeholders are voluntarily granted influence in corporate decision making.Design/methodology/approach – The stakeholder governance practices of 46 companies were explored in a multiple comparative case analysis, drawing on publicly available sources.Findings – The research finds that stakeholders are granted a voice regarding operational, managerial as well as strategic issues. The power granted to stakeholders varies from non‐participation to co‐decision making. The majority of engagements found are a combination of low power and low scope of participation, which are limited in their potential to align the views of those inside and outside the corporate boundaries.Research limitations/implications – The data used in this research relied on publicly available sources, such as company reports, articles and web sites.Practical implications – By seeing an array of different stakeholder governance mechanisms managers can reflect on their own approach to stakeholders ...
119 citations
TL;DR: In this paper, the authors investigate how country contexts pressure firms for greater reporting activity and explore the impact of these pressures on disclosure quality, finding that higher reporting quality is more closely linked to normative and cultural pressures, and these pressures appear to be more important in stronger regulatory contexts.
Abstract: Purpose – This research project aims to investigate how country contexts pressure firms for greater reporting activity and to explore the impact of these pressures on disclosure quality. Design/methodology/approach – A theoretical lens is used to based on the three pillars of institutions: regulative, normative, and cultural in order to assess qualitatively how strong each pillar is reflected in creating a context with regard to disclosure, and then to compare two disclosure ratings’ reports – that of the Carbon Disclosure Project (CDP) and that of CERES – to provide a quantitative comparison of disclosure quality. Findings – Expecting that countries with higher regulative pressures, such as France, will lead to a ‘‘minimum-requirement’’ type of disclosure, while countries with more liberal markets, such as the USA, will present higher quality disclosure, counter-theoretical evidence was found in the results, indicating that French firms exhibit higher quality disclosure than US firms on average. Research limitations/implications – The findings, although derived from a small sample limited to the banking sector, point to the possibility that higher reporting quality is more closely linked to normative and cultural pressures, and that these pressures appear to be more important in stronger regulatory contexts. Originality/value – The results inform the public policy literature, seeking to explore the effectiveness of self-regulation in face of increasing mandatory requirements. The paper also contributes to the disclosure literature, by establishing a relationship between disclosure quality and institutional context, and to the institutional theory literature by inscribing the study within the nascent stream of empirical papers in search of a methodology to compare institutional contexts across countries and their impact on firms’ reporting activities.
113 citations
TL;DR: In this article, the influence of corporate board structure on corporate value was examined on a sample of 245 Thai non-financial listed companies and the results showed that neither independent directors nor grey directors are the significant determinants of improving firm value.
Abstract: Purpose – This paper aims to examine the influence of corporate board structure on corporate value.Design/methodology/approach – The data were collected on a sample of 245 Thai non‐financial listed companies to examine the effect of board structure on firm performance.Findings – The results show that neither independent directors nor grey directors are the significant determinants of improving firm value.Research limitations/implications – This research was confined to 245 Thai non‐financial listed companies. It would be useful to replicate it using larger samples under different country settings.Practical implications – The findings provide guidance to top managers in deciding the Board structure as corporate value is also grounded in corporate board structure.Originality/value – The paper provides far reaching implications for corporate managers about the relationship between Board characteristics and corporate value.
104 citations
TL;DR: In this article, the authors examine whether companies that engage in tax avoidance through locating their headquarters in tax havens make any claims to act socially responsibly, and investigate how being based in an offshore finance center impacts on the firm's commitment to key organisational stakeholders.
Abstract: – The payment of taxes is both a crucial corporate contribution to society and essential to good governance; but it is an under‐researched aspect of corporate social responsibility (CSR). Hence this paper first seeks to examine whether companies that engage in tax avoidance through locating their headquarters in tax havens – or Offshore Finance Centres (OFCs) – make any claims to act socially responsibly. If so, the paper, second, aims to investigate how being based in an OFC impacts on the firm's commitment to key organisational stakeholders., – In the light of the sensitivity of the issue, the research questions are studied through an analysis of the content of codes of conduct that have been adopted by a sample of firms based in OFCs. The results are compared with a sample of US firms., – OFC‐based firms do indeed make claims that they engage in responsible business practices. However, the commitments by OFC‐based companies vis‐a‐vis key stakeholders fall in almost all cases short of those made by the sample of US firms., – With regard to CSR theory, the paper shows how organisational legitimacy is the result of a complex interaction between strategic legitimacy efforts by OFC‐based companies and isomorphic processes in the wider social system. In terms of CSR practice, the paper argues that claims to acting socially responsibly by firms that do not even fully meet their economic responsibilities to society may, in the longer term, undermine the very idea of CSR.
103 citations
TL;DR: In this paper, the authors examined the relationship between board composition and firm performance using a board-level aggregation variable and found that firms with a high representation of outside and foreign directors are associated with better performance compared to those firm boards that have a majority of insider executive and affiliated non-executive directors.
Abstract: Purpose – This paper seeks to examine the relationship between board composition and firm performance using a board‐level aggregation variable.Design/methodology/approach – This study uses linear regression to analyze the relationship between board role typology and firm performance using a panel data set of 277 non‐financial listed Malaysian firms over the period 2002‐2007.Findings – The empirical results show that firm‐boards with a high representation of outside and foreign directors are associated with better performance compared to those firm‐boards that have a majority of insider executive and affiliated non‐executive directors.Research limitations/implications – The findings seem to imply that in widely owned firms a higher proportion of outsiders on the board reduces under‐investment and agency problems, which has significant economic implications.Originality/value – This is the first study to use a board‐level aggregation variable to demonstrate the impact of boards' resourcefulness on firm perfo...
99 citations
TL;DR: In this paper, the authors report on a study of the Roundtable on Sustainable Palm Oil (RSPO) as an instance of "partnered governance" oriented to advance sustainable development in a supply chain.
Abstract: Purpose – This paper sets out to report on a study of the Roundtable on Sustainable Palm Oil (RSPO) as an instance of “partnered governance” oriented to advance sustainable development in a supply chain. After briefly discussing the conceptualization of partnered governance, its social organizational features, and its drivers, the paper aims to outline the history and structure of RSPO and then to assess the effectiveness, efficiency and level of legitimation of this innovative governance structure. The paper points out several of the limitations as well as potentialities of partner governance arrangements such as that of RSPO.Design/methodology/approach – The paper shows through a focused multi‐method case study how the RSPO developed as consumer‐oriented businesses partnered with civil society organizations and palm oil producers to address what was seen as a long‐term threat to rain forests, on the one hand, and to financial interests, on the other.Findings – In the case of deforestation caused by oil ...
96 citations
TL;DR: In this paper, the authors investigated the relationship between ownership structure and corporate governance, namely the factors that determine institutional investors' investment decisions in emerging markets using Jordanian data and found that Jordanian institutional investors consider firms' capital structure, profitability, business risk, asset structure, asset liquidity, growth rates, and firm size when they take their investment decisions.
Abstract: Purpose – This paper aims to be one of the first papers to investigate the relationship between ownership structure and corporate governance, namely the factors that determine institutional investors' investment decisions in emerging markets using Jordanian data.Design/methodology/approach – A panel data analysis is applied to the dataset that includes non‐financial Jordanian firms.Findings – The results show that the Jordanian institutional investors consider firms' capital structure, profitability, business risk, asset structure, asset liquidity, growth rates, and firm size when they take their investment decisions. In addition, institutional investors in Jordan prefer to invest in services firms rather than manufacturing firms. Furthermore, the study cannot find any significant relationship between firms' dividend policy and institutional investors.Practical implications – The practical implication of the study is that institutional investors should take under consideration the investigated variables i...
87 citations
TL;DR: In this paper, the authors developed a complementary and collaborative model of IT governance and used a multiple case approach in which IT governance is examined against the model in four major universities in the UK.
Abstract: Purpose – The aim of this paper is to provide an understanding of information technology (IT) governance, from both a theory and practice perspective, and to identify current theory‐practice gaps within the organisations studied.Design/methodology/approach – This study developed a complementary and collaborative model of IT governance and used a multiple case approach in which IT governance is examined against the model in four major universities. Case study research is qualitative in nature enabling insights into the “how” and “why” of IT governance to be gained.Findings – Based on underlying theory, the study was able to develop propositions regarding IT governance practices, observe current practices within the participating universities and establish gaps between theory and practice. The study identified theory‐practice gaps in each of three IT governance dimensions: structure, process and people. Gaps ranged in significance from small to large. Two large gaps existed which require attention: they are...
84 citations
TL;DR: In this paper, the authors employed a cross-section regression of the turnover rate of 84 of Fortune magazine's "100 best employers" against measures of corporate social responsibility (CSR) and several other control variables such as annual wages, ethnic and gender composition of the labor force that economic theory and prior studies have identified as explaining firm labor turnover.
Abstract: – This paper aims to estimate empirically the effect on the voluntary turnover (quit) rate of employees when a large public corporation already judged as an outstanding employer is also ranked as being socially responsible by an external review organization., – The paper employs a cross‐section regression of the turnover rate of 84 of Fortune magazine's “100 Best Employers” against measures of corporate social responsibility (CSR) and several other control variables such as annual wages, ethnic and gender composition of the labor force that economic theory and prior studies have identified as explaining firm labor turnover., – Adoption of business policies that cause the firm to be rated as socially responsible reduce the annual quit rate by 3 percent to 3.5 percent, which amounts to a 25‐30 percent reduction, as compared to non‐CSR public corporations or a larger comparison set including privately held and not‐for‐profit firms., – The wider universe of public corporations may not realize comparable turnover benefits from CSR as these “best employers” because these firms might be especially vulnerable or sensitive to corporate image when hiring workers., – The model estimated permits calculation of the annual rise in average wages that would be required to reduce turnover by the same amount as CSR, a sum of approximately $3,700 per year or about 9 percent of the mean wage, with a lower bound estimate of about $1,000. This suggests that these firms can significantly reduce labor costs by investing in worker‐friendly employment policies, which account for half of the entire measured CSR impact., – This is believed to be the first effort to quantify rigorously the effect of CSR on the employment side of firm performance. Prior labor studies have looked at hypothetical employment scenarios involving students.
TL;DR: In this paper, the authors explore existing and potential linkages between multi-stakeholder standards and explore the potential for standard convergence, and propose a categorization scheme for the availability of such standards.
Abstract: Purpose – This paper aims to explore how existing collaborative governance arrangements in the context of corporate responsibility (e.g. the Global Reporting Initiative and Social Accountability 8000) need to collaborate more directly in order to enhance their impact. The objective of this paper is twofold: primarily, to explore existing and potential linkages between multi‐stakeholder standards; but, at the same time, to explore the potential for standard convergence.Design/methodology/approach – The paper follows a conceptual approach that is supported by a variety of case examples. First, the nature and benefits as well as shortcomings of multi‐stakeholder standards are explored. Second, a categorization scheme for the availability of such standards is developed. Third, linkages between the different standard categories are explored and discussed. Last but not least, the paper outlines practical implications.Findings – A variety of linkages between existing multi‐stakeholder standards exist. These link...
TL;DR: In this paper, the authors determine whether corporate governance, outreach to clients, reduced dependence on subsidies and use of modern technology (together called corporate governance plus) are associated with the performance of rural and community banks (RCBs), which are microfinance institutions (MFI), in the context of newly adopted codes of conduct and regulations, ownership rules and quality of management.
Abstract: Purpose – The purpose of this paper is to determine whether in Ghana, corporate governance, outreach to clients, reduced dependence on subsidies and use of modern technology (together called corporate governance plus) are associated with the performance of rural and community banks (RCBs), which are microfinance institutions (MFI), in the context of newly adopted codes of conduct and regulations, ownership rules and quality of management.Design/methodology/approach – A total of 30 randomly sampled RCBs were categorized into four groups based on analysis of several dimensions of financial performance. Next, RCBs were again categorized into four groups based on their corporate governance plus. A chi‐squared test of independence between the two groupings was performed.Findings – The authors found no association between RCBs' categories based on corporate governance plus and their categories based on financial performance.Practical implication – To enhance performance, corporate governance plus must impact fi...
TL;DR: In this article, the United Nations Global Compact (GC) has been examined by examining one key CSR initiative, namely, the GC initiative, and it was found that participants of the GC that have integrated their CSR into their policies, programs, performance, and goals, and those with lesser conformity with the active principles of GC wil...
Abstract: Purpose – This paper seeks to understand what impact the current economic and financial crisis has had on the business and non‐business sector's corporate responsibility (CR) efforts, as well as to describe the critical obstacles being reported to such efforts. It proposes to do this by examining one key CSR initiative, namely, the United Nations Global Compact (GC).Design/methodology/approach – A two‐part empirical investigation was conducted on a sample of GC participants (US signatories). The first method comprises a comprehensive survey completed mainly by company CEOs. The second approach involves content analysis of CEO statements (extracted from CSR reports – fiscal years 2007‐2009), which describe new strategies for managing under challenging economic and financial times.Findings – It was found that the CSR efforts of participants of the GC that have integrated their CSR into their policies, programs, performance, and goals, and those with lesser conformity with the active principles of the GC wil...
TL;DR: In this article, the authors investigate the determinants and the evolution of voluntarily adopted firm-level corporate governance practices in Brazil from 1998 to 2004 using broad corporate governance scores, and they find that firm level governance practices are s...
Abstract: Purpose – This paper aims to investigate the determinants and the evolution of voluntarily adopted firm‐level corporate governance practices in Brazil from 1998 to 2004 using broad corporate governance scores.Design/methodology/approach – The authors employ a robust panel‐data procedure that accounts for the main sources of endogeneity to a very representative panel of Brazilian firms over a six‐year period. They address the endogeneity that arises from the simultaneous determination of the quality of corporate governance practices, the dependent variable, and possibly several firm attributes that are commonly employed as the determinants of such practices and are supposedly independent. Specifically, theoretical arguments and empirical evidence strongly suggest that the quality of corporate governance practices may influence some of the variables commonly used as its determinants just as much as they may be influenced by them.Findings – The paper finds that firm‐level corporate governance practices are s...
TL;DR: In this paper, the authors investigated the effect of certain classes of corporate ownership on capital structure decisions among firms in Nigeria, and found that discrimination between indigenous and foreign firms is a major determinant of financial leverage in Nigeria.
Abstract: Purpose – The primary aim of this paper is to investigate the nature, degree and direction of the effects of certain classes of corporate ownership on capital structure decisions among firms.Design/methodology/approach – Using a sample of 71 quoted companies in Nigeria, the study adopts panel fixed effects regression models to estimate the relationship between financial leverage and corporate ownership, while controlling for some firm‐specific characteristics like profitability, firm size and firm age.Findings – The study finds that discrimination between indigenous and foreign firms is a major determinant of financial leverage in Nigeria; and that the consistency of empirical results and capital structure theories across countries depends much on the dominant nature of corporate ownership structure.Research limitations/implications – An attempt to widely generalize the results of this study may be challenged by its relatively small sample. With data from just a sample of 71 firms, the robustness of the c...
TL;DR: In this paper, the authors examined whether the corporate governance rankings published by a market information intermediary are reflected in the values that investors accord to firms and found that good governance rankings are related to not only firm market value, but also to accounting results.
Abstract: Purpose – This paper aims to examine whether the corporate governance rankings published by a market information intermediary are reflected in the values that investors accord to firms.Design/methodology/approach – Panel data from 289 Canadian firms in the four‐year period 2002‐2005 were analyzed using a price model.Findings – The results suggest that the corporate governance rankings published by the market information intermediary are related to not only firm market value, but also to accounting results.Practical implications – This study provides empirical observations that would be useful for various organizations involved in the regulation of corporate governance practices and the standardization of relevant data elements.Originality/value – This study contributes to the literature by demonstrating that information published by an information intermediary is reflected in firm market values. Moreover, this information appears to be related to the accounting results. Thus, good governance rankings are ...
TL;DR: In this paper, the authors investigate the application of sound governance principles across different types of healthcare organizations in the context of a developing country, together with differing understanding and applications of corporate social responsibility.
Abstract: Purpose – Sound corporate governance is now a mainstream issue of concern in the business world. However, there has been no systematic investigation of corporate governance practices in the healthcare sector. Allowing for a distinction between two types of healthcare organizations (profit and non‐profit), this paper aims to investigate nuances in the application of sound governance principles across different types of healthcare organizations in the context of a developing country, together with differing understanding and applications of corporate social responsibility.Design/methodology/approach – The paper is based on a qualitative interpretive methodology, comprising in‐depth interviews with top hospital executives drawn from 21 Lebanese hospitals representing both the profit and non‐profit varieties.Findings – The findings suggest some basic governance differences between for‐profit and non‐profit hospitals in terms of managerial structure, ownership and the role of the board of directors, as well as...
TL;DR: In this article, the authors propose a measurement and a governance model to evaluate and manage the business as well as the societal benefits of CSR, based on a sound theoretical analysis.
Abstract: Purpose – The economic crisis has more than ever revealed the necessity for companies to extend their focus from the maximization of shareholder returns to the management of their complex stakeholder relationships including societal stakeholders. Although companies and scholars alike have been searching for adequate performance measurement systems that allow them to evaluate their relations with society, practical approaches to measure the benefits of CSR are still missing. This paper aims at filling this research gap. It proposes a measurement and a governance model to evaluate and manage the business as well as the societal benefits of CSR.Design/methodology/approach – The research follows a two‐step approach. First, a measurement model is developed based on a sound theoretical analysis. It is then applied in an in‐depth case study to test its applicability to business practice.Findings – The research finds that current measurement approaches fail to provide a practicable measurement framework, especial...
TL;DR: In this article, the authors analyze city networks as they face the challenges of global warming and introduce the notion of "governance from the middle" as an alternative to traditional intergovernmental policy.
Abstract: Purpose – This study aims to analyze city networks as they face the challenges of global warming. It seeks to introduce the notion of “governance from the middle” as an alternative to traditional intergovernmental policy. This is developed by focusing on the particular experiences of the C40 Cities Leadership Group and discussing its prospects and risks.Design/methodology/approach – CCI works with a number of commercial banks, institutional investors, international financial institutions and other capital providers to design financing programmes and source capital.Findings – The C40 Group illustrates some fundamental traits of city networks with a hybrid governance structure, combining traditional public institutional structures with market‐based arrangements, organizationally and qualitatively governing from the middle. Critical factors in this dynamic are the use of an external implementing body, providing new organizational opportunities for the network, and the prominence given to an integrated procur...
TL;DR: In this article, case studies show that life-cycle management (LCM) can be an important alternative approach in managing sustainability, performance of products and materials along the value chain.
Abstract: Purpose – Environmental management has not kept pace with the challenges of globalization. Case studies show that life‐cycle management (LCM) can be an important alternative approach in managing sustainability, performance of products and materials along the value‐chain.Design/methodology/approach – The paper analyzes case study models for LCM used in different circumstances. It compares the new forms of governance along the life‐chain, and the coordination of environmental management tools already in widespread use. Strengths and weaknesses are discussed with respect to other CSR methods in current use. The role of life‐cycle assessment (LCA) in prioritizing sustainability issues is highlighted.Findings – Business focuses on supply‐chain management to achieve its sustainability goals. Governments give emphasis to communication rather than legislation. Community and NGO pressure on the commodity resource sector has led to important multi‐stakeholder life‐cycle‐management. These approaches are most effecti...
TL;DR: In this article, the authors explore the limits of stakeholder governance and contribute a better comprehension of the relationships between corporate social performance and corporate financial performance through the development of a dynamic model that links together innovation and change.
Abstract: Purpose – The purpose of this paper is to explore the limits of stakeholder governance and to contribute a better comprehension of the relationships between corporate social performance (CSP) and corporate financial performance (CFP) through the development of a dynamic model that links together innovation and change, stakeholder cohesion, and competitive advantage.Design/methodology/approach – The approach takes the form of theory building through the development of eight testable propositions.Findings – Stakeholder cohesion may have a “dark side” to the extent that it results in inertia and resistance to change, thus reducing propensity to innovation and change. The latter, in turn, are vital for both competitive advantage and stakeholder cohesion itself. Therefore, propensity to innovation and change is the pivotal variable that helps to explain the complex, non‐linear, often inextricable relationships between CSP and CFP. Furthermore, external (environmental dynamism) and internal (firm culture) varia...
TL;DR: In this article, the authors look at the crisis in terms of a failure of corporate governance and suggest that a multivariate quality management may be a positive reaction to the crisis and offer insights based on privileged original data from senior managers.
Abstract: Purpose – This paper seeks to look at “the crisis” in terms of a failure of corporate governance.Design/methodology/approach – The paper relies on data summarized from personal interviews with directors of financial institutions in the aftermath of September 2008. It takes an interpretive approach and mediates the date to unpick the crisis in terms of governance at four levels.Findings – The paper suggests that a multivariate quality management may be a positive reaction to the crisis.Originality/value – The paper offers insights based on privileged original data from senior managers.
TL;DR: In this article, the authors developed a multi-attribute pattern of the corporate governance model in Thai state-owned enterprises, assessed the relative importance of different corporate governance practices, and provided detailed information of each corporate governance practice.
Abstract: Purpose – The primary objectives of this paper are to: develop a multi‐attribute pattern of the corporate governance model in Thai state‐owned enterprises; assess the relative importance of different corporate governance practices; and provide detailed information of each corporate governance practice.Design/methodology/approach – Qualitative and quantitative approaches were used. A case study was conducted to gather information on specific corporate governance behaviors in Thai state‐owned enterprises. Then a questionnaire was developed and tested in 38 Thai state‐owned enterprises. Factor analysis was conducted to examine a common framework of corporate governance practices.Findings – This research demonstrated the multi‐attribute nature of the corporate governance model in Thai state‐owned enterprises. According to this model, the most important corporate governance practice is strategic human resource management, followed by information technology, board of directors, risk management, internal control...
TL;DR: In this paper, the authors take stock of core arguments in some of the most central governance traditions and discuss their capacity to deliver solutions, including the effect of media and communication as governance arenas in their own right.
Abstract: Purpose – This paper seeks to take stock of core arguments in some of the most central governance traditions and to discuss their capacity to deliver solutions It starts with an appraisal of the strengths and weaknesses of the ideas of market‐, state‐ and civil‐society‐led governance, but also factors in the effect of media and communication as governance arenas in their own right Then it aims to review core arguments put forward in broader approaches to governance where multiple governance mechanisms are combinedDesign/methodology/approach – This is a conceptual paper that reviews central approaches in the governance literature and their ability to further sustainable development The review is taken as a basis for tentative formulations of new supplementary governance approachesFindings – Out of the critical analysis the paper distils is an approach to governance that combines three basic elements: First, a re‐interpretation of Montesquieu's principle of checks and balances – applied not only to sta
TL;DR: Wang et al. as mentioned in this paper used basic data compilation method to investigate the board characteristics of large and medium Chinese companies listed on the Shenzhen and Shanghai Stock Exchange between 2004 and 2006.
Abstract: Purpose – This paper aims to contribute to research studies on boards of directors in the Chinese transition economy that are by far, few and limited.Design/methodology/approach – This paper uses basic data compilation method to investigate the board characteristics of large and medium Chinese companies listed on the Shenzhen and Shanghai Stock Exchange between 2004 and 2006. Sample data on these companies were obtained from the China Center for Economic Research (CCER) database that contains information on at least 1,350 listed companies in a particular year. Companies with missing data or incomplete information on board attributes are not included in the sample in this paper. Studies of relationships between board characteristics and firm performance in the Chinese context are compared to those studies in the West for determining whether there is a conclusive empirical outcome.Findings – This investigation found some significant differences in board characteristics between the Chinese and Western contex...
TL;DR: Wang et al. as discussed by the authors investigated the impact of ownership concentration on executive compensation in emerging economies, and then empirically tested the hypotheses based on the archival data of publicly held firms in China.
Abstract: Purpose – The research on corporate governance has different perspectives on the relationship between ownership concentration and executive compensation, and the empirical findings on this linkage are also inconclusive. The purpose of this paper is to investigate the impact of ownership concentration on executive compensation in emerging economies.Design/methodology/approach – By connecting different perspectives with the characteristics of emerging economies together, this research explores the impact of ownership concentration on executive compensation, and then empirically tests the hypotheses based on the archival data of publicly held firms in China.Findings – The paper finds that there is no significant relationship between ownership concentration and executive compensation in state‐owned enterprises (SOEs), while there is a U‐shaped relationship in non‐SOEs.Originality/value – This study not only offers an empirical test of the effect of ownership concentration on executive compensation, but also p...
TL;DR: In this paper, the authors bring together ethical governance theory and empirical findings to examine the shifting nature of governance in global value chains, and the implications of this shift for mainstream companies.
Abstract: Purpose – This paper seeks to bring together ethical governance theory and empirical findings to examine the shifting nature of governance in global value chains, and the implications of this shift for mainstream companies. In particular, it aims to examine one of the more mature models of ethical value chain governance, Fairtrade, and how this is being used by business.
Design/methodology/approach – Information is derived from a longitudinal study of multi-stakeholder co-governance in Kenya and the UK, and an analysis of the literature on similar co-governance models.
Findings – The paper shows that mainstream companies are looking to multi-stakeholder models not only to protect their reputation, but as a way of governing ethical dimensions of their value chains. However, rather than a form of co-governance, it has become a way of outsourcing governance, enabling companies to strengthen their public credibility, while simultaneously transferring an especially difficult element of modern value chain governance to organizations enjoying high consumer trust. Yet, primary data suggest that these governance systems are not delivering the benefits promised, at least at the producer level.
Practical implications – By outsourcing governance to initiatives with dubious credibility in this way, companies may seem at risk. However, the mismatch between the promise and delivery of Fairtrade does not seem to be affecting consumer confidence and, until it does, companies may continue to benefit from the halo effect of being a Fairtrade ally. But there are also opportunities for companies to use Fairtrade's weaknesses to make the value chain a better avenue for delivering ethical governance, with implications for similar co-governance models.
Originality/value – The study draws on one of the very few pieces of longitudinal field research on the impacts of Fairtrade. It approaches Fairtrade from a governance rather than reputations perspective, and emphasizes the implications for mainstream business rather than the co-governance movement.
TL;DR: In this article, the authors explore two under-developed areas of board research: the corporate governance of unlisted companies; and board behaviour, focusing on process factors that contribute to a board performing effectively.
Abstract: Purpose – The purpose of this paper is to explore two under‐developed areas of board research: the corporate governance of unlisted companies; and board behaviour, focusing on process factors that contribute to a board performing effectively.Design/methodology/approach – The Board Effectiveness Questionnaire was completed by 67 directors, to gather views on how their board currently operates and how they think it should operate, across various behavioural areas relating to the relationships, decision making, the working climate and predispositions. Analysis of “process losses”, the pattern of sub‐optimal board behaviour, allowed the testing of four hypotheses concerning board effectiveness.Findings – The 18 most important and five least important behaviours were identified, plus 12 showing the greatest “process loss”. Quality of team “relationships” is the main cause of loss whereas evidence for the impact of leadership style is mixed. Size of the board is related to overall performance of the board but n...
TL;DR: In this article, the power dynamics of the boards of directors in family-owned and listed Turkish companies were studied in relation to three variables: the institutional environment in which the firm is embedded; the structural configurations of the board; and the top manager's propensity to exercise his/her power resources.
Abstract: Purpose – The purpose of this study is to understand the power dynamics of the boards of directors in family‐owned and listed Turkish companies Power and dominance in the boardroom can be studied in relation to three variables: the institutional environment in which the firm is embedded; the structural configurations of the board; and the top manager's propensity to exercise his/her power resources Focusing on the board level, this paper aims to conceptualize power dynamics as being composed of structural attributes, roles assumed, responsibilities, dependency and representationDesign/methodology/approach – The research domain of this exploratory study is family‐owned and listed companies operating on the Istanbul Stock Exchange (ISE) The data for the study were collected from three different sources: a survey administered to members of the boards of directors; discourse analysis of corporate governance compliance reports of the same companies; and in‐depth interviews conducted with board membersFind