The erosion of stable shareholder practice in Japan (“Anteikabunushi Kosaku”)

This study reviews the academic literature to explain internationalisation, mode of entry choice and strategic momentum theory. In this research, we ask whether DiMaggio's theory of isomorphism can be applied to Japan, given the country's Anteikabunushi Kosaku practices and the evidence cited in the literature that suggests that national culture influences managerial work values and Japanese entry mode strategies.We suggest that Japanese management attitudes towards entry mode strategy are changing due to a change in corporate governance policy and competition. In response, we argue that Japan's stable shareholder practice is eroding and that as a result of this erosion, the change observed in institutional behaviour is isomorphic.     

Corporate governance in emerging markets: A selective review and an agenda for future research

In this paper, we show how corporate governance reforms and research have been mutually reinforcing in emerging markets and propose a research agenda going forward. Acknowledging the by now broad recognition of corporate governance as a key development driver, we show how work on corporate governance in emerging markets has led research globally by focusing on the deep issues of ownership structures, property rights and organisational forms. Using the papers presented at the latest international conference of the Emerging Markets Corporate Governance Research Network, we illustrate how analyses of board structures, specifically gender diversity, has contributed to understanding of board dynamics and informed corporate governance reforms. Considering ongoing economic and socio-political trends, we conclude with a general research agenda for corporate governance in emerging markets.     

The Politics of Shareholder Activism in Nigeria

Shareholder activism has become a force for good in the extant corporate governance literature. In this article, we present a case study of Nigeria to show how shareholder activism, as a corporate governance mechanism, can constitute a space for unhealthy politics and turbulent politicking, which is a reflection of the country’s brand of politics. As a result, we point out some translational challenges, and suggest more caution, in the diffusion of corporate governance practices across different institutional environments. We contribute to the literature on corporate governance in Africa, whilst creating an understanding of the political embeddedness of shareholder activism in different institutional contexts—i.e. a step closer to a political theorising of shareholder activism.     

Theorising South Africa’s Corporate Governance

South Africa’s principal corporate governance report aspires to an ‘inclusive’ approach to corporate governance, in which companies are clearly advised to consider the interests of a variety of stakeholders. Yet, in common with many other countries, there is little discussion of the theoretical foundations and assumptions implicit in the recommended approach to corporate governance. The purpose of this article is to provide an analysis of corporate governance and the corporate environment in South Africa in terms of existing theory and models of corporate governance, and to provide a critique based on a consideration of traditional African values and the socio-economic necessities of post-apartheid South Africa. The result is the identification of an incompatibility between the current corporate environment in South Africa and the given exposition of African values. Some prospects for change are then identified.     

两权分离与公司治理的演进——英美经验与我国实践

公司治理的演进过程也是所有权和控制权以及经营权分离的过程。通过对英美国家公司发展不同时期两权分离的历史考察,发现两权分离与公司治理演进之间存在依存关系：两权分离依次经历了所有权和经营权分离、所有权和控制权分离、控制权和经营权分离和同股不同权等阶段,不同形式的两权分离带来不同的公司治理问题,从而产生相应的治理手段,推动着公司治理的演进。通过对中国企业改革和发展过程的历史回顾也证明了两权分离与公司治理之间存在共同演进关系。针对研究发现,最后提出了我国公司治理改革的方向性建议。     

The role of corporate governance in FDI decisions: Evidence from Taiwan

There has been a considerable literature on the determinants of why firms undertake foreign direct investment (FDI), but very little on whether firms with different governance characteristics are more or less likely to venture overseas. For example, are family-controlled firms more predisposed to FDI than firms, with similar attributes, but different forms of ownership? Does the presence of institutional shareholders suggest a greater propensity to invest abroad? Does the composition of the Board of Directors have an impact? Most extant studies of corporate governance focus on the impact of governance factors on firm performance. However, these performance outcomes are a function of the strategic decisions made by the firms, which suggests it might be useful to consider the relationship between corporate governance factors and particular strategic decisions. One example is the decision to undertake foreign direct investment. The two main strands of IB literature on the determinants of FDI have little or nothing to say about how corporate governance factors might affect the FDI decision. Both internalisation theory and the resource-based view see FDI primarily as a means by which firms can appropriate rents in overseas markets from the exploitation of their idiosyncratic resources and capabilities. This paper extends this literature by investigating the effects of governance factors on the decision to undertake FDI. In particular, we want to assess the impact upon the FDI decision of (a) the extent of family control, (b) the presence of domestic and foreign institutional shareholders, and (c) the composition of the Board of Directors. We investigate these effects using a sample of 228 publicly listed firms in Taiwan, and our results clearly indicate that family control and share ownership by domestic financial institutions in Taiwanese firms are associated with the decision to undertake FDI. We also find that corporate governance impacts in different ways with regard to Taiwanese FDI in China in comparison to Taiwanese FDI in the rest of the world.     

Multiple influences on corporate governance practice in Nigeria: Agents,strategies and implications

The literature on the convergence of corporate governance systems across different institutional contexts has often taken the role of ‘agents of convergence’ for granted. Against this background, we examine the influences of three major agents – international organisations, rating agencies, and local institutions – on the development of corporate governance practices in Nigeria. Findings indicate that the understanding and practice of corporate governance in Nigeria are in a flux and being pulled in multiple directions by the agents studied. This paper provides one of the very few studies utilising sub-Saharan African (Nigerian) data in international business governance research.     

The Relationship between Family Firms and Corporate Governance*

This paper contributes to the agency theory literature by identifying relations between family control and corporate governance structure. Emerging literature supports the notion that family control creates strong incentives that have potentially competing influences on the manner in, and extent to, which internal corporate governance mechanisms are utilized. A sample of 100 listed companies (evenly divided between family and nonfamily firms) is used to test the hypotheses that corporate governance structures are different between family and nonfamily firms; and that family firms adopt optimal corporate governance structures. This research finds evidence that suggests that family firms utilize substantially different corporate governance structures from nonfamily firms and that these differences lead to performance differentials. Indeed, results suggest that family control creates, rather than negates, agency costs and future research may be well rewarded by pursuing this latter notion further.     

Intragroup Transactions,Corporate Governance,and Corporate Philanthropy in Korean Business Groups

This study examines how the corporate philanthropy decisions of group-affiliated firms in Korea (Chaebol firms) are made. Based on the attention-based view, we argue that when corporate decision makers at group-affiliated firms focus their attention more (less) on internal markets than external stakeholders because of the firm’s high (low) reliance on intragroup transactions, the firm will decrease (increase) its level of corporate philanthropy. We further argue that the relationship will be stronger when governance mechanisms focus on the instrumental value of corporate philanthropy. Using a panel sample of group-affiliated firms in Korea from 2011 to 2015, we find that as intragroup sales increase, the level of corporate philanthropy decreases, and such a negative relationship is stronger when outside director representation and foreign investor ownership are high. Our study suggests that internal dependence and corporate governance mechanisms jointly affect the level of corporate philanthropy at firms in a business group. Thus, this study contributes to the literature on corporate philanthropy, business group, and corporate governance.     

Early and late adoption of American-style executive pay in Germany: Governance and institutions

Employing the theoretical perspective of neo-institutional change, this paper identifies the characteristics of early and late adoption of executive stock options (ESOs) in German firms. The paper contributes to the debate over the convergence/divergence of corporate governance systems, adding to the literature on institutional change by demonstrating the reaction of intra-organizational actors to macro-level changes. The study finds that there is employee resistance to the adoption of ESOs in the early stages, and older firms, embedded in traditional practices, prefer to maintain the status quo. Prior adoption of shareholder value oriented practices helps to smooth the way for subsequent adoptions for both early and late adopters. The full convergence of corporate governance systems is still not imminent.     

Corporate Governance and Ethics: A Feminist Perspective

The mainstream literature on corporate governance is based on the premise of conflicts of interest in a competitive game played by variously defined stakeholders and thus builds explicitly and/or implicitly on masculinist ethical theories. This article argues that insights from feminist ethics, and in particular ethics of care, can provide a different, yet relevant, lens through which to study corporate governance. Based on feminist ethical theories, the article conceptualises a governance model that is different from the current normative orthodoxy.     

Enough chit-chat,strike! Deliberation and agonism in corporate governance

This conceptual paper contributes to the critique of a body of literature that will be named ‘deliberative corporate governance’ by defending non-deliberative acts performed by stakeholders. It first argues that this literature introduces to the corporation a decision-making process where it does not belong, given the corporation's economic role. This leads to an ‘efficiency constraint’ on any attempt to justify deliberation – deliberative governance theorists must show that it is the most efficient and cost-effective way to address the issues that concern them. A real case example where deliberation would have been counter-productive in that regard will show that this is not the case. Building on this example, the paper uses the theory of democratic agonism to argue that non-deliberative acts should be part of governance. A sketch of managerial duties vis-à-vis such acts is attempted as well. The paper does not seek to reject deliberative corporate governance entirely, but rather to defend the importance of non-deliberative practices in addressing its theoretical concern. It makes a conceptual contribution to corporate governance theory, from which it draws practical implications for stakeholders-oriented management.     

中小企业治理结构变迁与管理层收购

中小企业是国民经济的重要组成部分,在国民经济中占有重要地位。从中小企业治理结构变迁的历程看出,现代公司制的治理结构并不一定适合中小企业的发展。运用管理层收购改进中小企业治理结构将会促进其健康持续发展,但要注意健全法律法规、合理确定市场定价及建立退出机制等问题。     

Galvanising Shareholder Activism: A Prerequisite for Effective Corporate Governance and Accountability in Nigeria

Shareholder activism has been largely neglected in the few available studies on corporate governance in sub Saharan Africa. Following the recent challenges posed by the Cadbury Nigeria Plc, this paper examines shareholder activism in an evolving corporate governance institutional context and identifies strategic opportunities associated with shareholders’ empowerment through changes in code of corporate governance and recent developments in information and communications technologies in Nigeria; especially in relation to corporate social responsibility in Nigeria. It is expected that the paper would contribute to the scarce literature on corporate governance and accountability in Africa. Olufemi Amao (LLM, Warwick; LLM, Ibadan, Nigeria; LLB, OAU, Nigeria; BA, Ilorin, Nigeria; BL, NLS) is a PhD candidate at the Faculty of Law, University College Cork, Ireland. He is a recipient of the President PhD Scholarship and the Department of Law Scholarship. His current research interests include Corporate Social Responsibility, Corporate Governance, Multinational Corporations and Human Rights. Kenneth Amaeshi is a Research Fellow at Warwick Business School. His research interests include commercialisation of intellectual property assets; governance of global innovation networks; R&D partnerships; sustainable innovation; multinational corporations and corporate social responsibility in developing economies. He is currently studying comparative political economy of corporate stakeholding and corporate social responsibility. He is the 2007 winner of the International award for excellence in the field of interdisciplinary social sciences, awarded by the international journal of interdisciplinary social sciences (Australia/USA).     

The crisis of Japanese retailing at the turn of the millennium: a crisis of corporate governance and finance

The year 2000 saw a sudden rise in failures of prominent Japanese retailers. With problems of corporate finance and governance being pointed out as early as the 1970s, the recent problems as well as the continuous rise of companies up to then have to be explained. This article contends that a major explanatory factor is the weakening of the existing stable relationships between retailers and financial institutions. Banks functioned as lenders, shareholders and providers of management resources. Changes in the banking sector led to changes in the relationship at the end of the 1990s. Problems in corporate governance surfaced that might result in a major reorganization of the Japanese retail scene.     

Large Shareholder Activism in Corporate Governance in Developing Countries: Evidence from India

Most of the existing evidence on the effectiveness of large shareholders in corporate governance has been restricted to a handful of developed countries, notably the UK, US, Germany and Japan. This paper provides evidence on the role of large shareholders in monitoring company value with respect to a developing and emerging economy, India, whose corporate governance system is a hybrid of the outsider‐dominated market‐based systems of the UK and the US, and the insider‐dominated bank‐based systems of Germany and Japan. The picture of large‐shareholder monitoring that emerges from our case study of Indian corporates is a mixed one. Like many of the existing studies, while we find blockholdings by directors to increase company value after a certain level of holdings, we find no evidence that institutional investors, typically mutual funds, are active in governance. We find support for the efficiency of the German/Japanese bank‐based model of governance; our results suggest that lending institutions start monitoring the company effectively once they have substantial equity holdings in the company and that this monitoring is reinforced by the extent of debt holdings by these institutions. Our analysis also highlights that foreign equity ownership has a beneficial effect on company value. In general, our analysis supports the view emerging from developed country studies that the identity of large shareholders matters in corporate governance.     

监督约束机制效率缺失的社会因素探析

本文认为,我国公司治理实践中监督约束机制效率缺失的原因是多方面的。传统的“人际和谐”观念对企业监督人思维方式潜移默化的影响,企业监督人的心理活动和状态与社会制度的变革方式等是不可忽视的因素,涉及到文化的、心理的、社会的、市场的等多方面内容,同时多个因素又相互交织在一起,共同组成了一个复杂的问题系统。因此,在实践中必须多管齐下,为企业公司治理建立一个强效的监督约束机制。     

Economic and Social Upgrading in Global Value Chains and Industrial Clusters: Why Governance Matters

The burgeoning literature on global value chains (GVCs) has recast our understanding of how industrial clusters are shaped by their ties to the international economy, but within this context, the role played by corporate social responsibility (CSR) continues to evolve. New research in the past decade allows us to better understand how CSR is linked to industrial clusters and GVCs. With geographic production and trade patterns in many industries becoming concentrated in the global South, lead firms in GVCs have been under growing pressure to link economic and social upgrading in more integrated forms of CSR. This is leading to a confluence of “private governance” (corporate codes of conduct and monitoring), “social governance” (civil society pressure on business from labor organizations and non-governmental organizations), and “public governance” (government policies to support gains by labor groups and environmental activists). This new form of “synergistic governance” is illustrated with evidence from recent studies of GVCs and industrial clusters, as well as advances in theorizing about new patterns of governance in GVCs and clusters.     

Corporate governance in publicly traded small firms: A study of Canadian venture exchange companies

Most evidence regarding the determinants and effects of corporate governance practices is based on large firms. Herein, we explore these issues in the context of small publicly traded Canadian companies. We exploit the fact that such firms were not subject to corporate governance guidelines prior to 2005 and thus analyze the determinants of voluntary governance practice choices, as well as the effects of those practices on firm performance. Using a unique data set, we construct a corporate governance index for each firm. We measure performance by two variables: quality of accounting earnings and financial performance. The results indicate that corporate governance does matter for smaller traded Canadian firms. We find that both accounting and financial performance are positively related to corporate governance; however, their underlying mechanisms may differ somewhat. Given this result, it would be natural to expect all firms to choose higher levels of governance. However, our results also suggest small firms face resource constraints that limit their choices. We conclude that good governance is an important driver of small firm performance that cannot be neglected by the owners and managers of these firms.     

Refining the Art of Reforming the Corporate Governance of Chinese State-Controlled Listed Companies: Venture Capital and Adaptive Efficiency

The corporate governance of Chinese state-controlled listed companies (SCLCs) has attracted much scholarly attention. Through reviewing the extant literature in this field, it is clear that the overwhelming majority is theoretically underpinned by the lens of agency costs. Another important perspective, adaptive efficiency, has yet to be equally emphasized by scholars. Reflecting on the experience of American venture capital (VC), this article puts forth that the corporate governance of SCLCs has weakened the fundraising ability of Chinese domestic VC. Taking account of the positive link of a vibrant VC sector and the enhancement of adaptive efficiency, an obvious conclusion is that the corporate governance of SCLCs has already jeopardized the adaptive efficiency of the Chinese economy. Further, the normative implication of this finding is that the refined art of reforming the corporate governance of SCLCs ought to combine and harmonize agency costs with adaptive efficiency.