Adversarialism versus legalism: Juridification and litigation in corporate governance reform

Recent reforms of corporate governance law and related litigation rules in the US and in Germany indicate that reports of the spread of adversarial legalism are greatly exaggerated. Politics and legislation in the US since the mid‐1990s have turned quite decisively against shareholder litigation even as corporate governance and securities law reforms have expanded the role and scope of the regulatory state. Germany's extraordinary expansion of financial and corporate governance regulation since the early 1990s exemplifies juridification. Although these reforms included some liberalization of shareholder litigation rules, the changes reflected skepticism towards private litigation and imposed new constraints on the most prevalent forms of shareholder suits. Marketization of economic relations and the era of finance capitalism have produced far more legalism than adversarialism, more regulation than judicialization, and more ex ante transparency rules than ex post litigation remedies.     

Corporate governance,property and democracy: a conceptual critique of shareholder ideology

Despite the resilience of national institutions and practices there are increasing signs that national systems of corporate governance are giving way to an idealized American model of shareholder activism and liquid equity markets. These pressures are ideologically backed by 'shareholderism', which consists of three claims: a prudential, a functional and a moral claim. The prudential one claims superior efficiency for shareholder control and market allocation of capital. The functional one bases its claim for shareholder control on the contribution of risk-carrying capital. The moral one is based on a liberal doctrine of ownership that grounds exclusive control rights in title-holders. This paper addresses the functional and moral claims. It argues that public equity markets do not contribute capital and that the Lockean conception of property is both untenable and morally reprehensible. Instead corporate democracy is proposed as a way to accommodate the conflicting claims of stakeholders. To do so an intelligent division of democratic labour is required. The paper ends with a sketch of such a model, through short outings to the real world of Dutch corporate governance.     

Das parteipolitische Paradox des Finanzmarktkapitalismus. Aktionärsorientierte Reformen in Deutschland, Frankreich, Italien und den USA

Addressing the debate over the political dynamics of different varieties of capitalism, this article tests the partisan hypothesis in the field of corporate governance. The state of research on distributional consequences of shareholder oriented corporate governance and on institutional complementarity between corporate governance and labor relations suggests that the center-left should oppose shareholder oriented reforms. In fact, our comparison of reforms during the last 15 years reveals the contrary. In Germany, France, Italy and the US, the center-left turned out the be the driving force behind the reforms, while the center-right parties tended to protect organized capitalism, state capitalism, family capitalism, and managerialism. The comparison allows specification of the impulses that made the center-left push for reforms while making the center-right protect traditional institutional arrangements. We present a conflict model that, beside class conflicts and insider/outsider-conflicts, includes conflicts over managerial control. The recent economic reforms cannot be understood without consideration of the significance of this conflict line.     

Shareholder value in an adverse environment: the German case

The German political economy has often been cited as a classical case of non-shareholder value orientation. Its productionist, long-term, consensus orientation has often been contrasted with the 'Anglo-Saxon approach'. The influence of shareholders who press for shareholder value and the importance of the equity market have traditionally been low. But there are signs of change. In this article we describe some of these changes and try to assess the dynamics of this change process. First we show that the limited role of the equity market for company financing and for private household savings still provides a very narrow base for a shareholder value economy in Germany. The central pillars of the German system of corporate governance - the dominating role of banks, the system of co-determination and the company centred management system - are not crumbling. Change in the direction of shareholder value is therefore limited.     

What Do Corporations Owe Citizens?

Institutional investors occupy an important location in the corporate governance system in countries with high shareholding, such as the US. As these are also countries where pensions are heavily invested in equities, the pension and corporate governance systems intersect, though they are usually analyzed separately. Institutional investors could play a more active role in corporate governance, but many if not most have not done so. Public pension funds are more proactive on corporate governance transparency issues than are the privately held funds, in part because the latter have some conflict of interest between those who own the parent firm and those who invest in the funds. Overall, institutional investors in the US have fewer powers over the managers than do the UK counterparts. Debates over SEC Rule 14a-8 which would give more power to IIs reflects the views and influence of competing lobbies on each side of the battleground among shareholders, managers, and employees over the cash flow of the firm, a battleground in which pension funds are increasingly important players.

Corporate governance on stakeholder issues: shareholder activism as a guiding force

Publicly traded corporations are under increasing amounts of pressure from society at large to redirect resources toward maximizing the value that accrues to non‐shareholding stakeholders of the organization. Building on the management and public relations literature, this study proposes a shareholder–stakeholder engagement model on corporate social responsibility (CSR)—the totality of corporate actions to meet societal norms and expectations. The study argues that shareholder activist–corporate engagements on CSR issues can enhance the corporation's sensitivity to stakeholder issues through improvements in the stakeholder governance mechanisms—institutions that safeguard stakeholder interests and maximize stakeholder welfare—within the corporations. Social shareholder activists, a special type of stakeholders, can be a viable source of pressure in influencing corporations to improve weaknesses in stakeholder governance mechanisms. Copyright © 2014 John Wiley & Sons, Ltd.     

Corporations, collective action and corporate governance: One size does not fit all

A review of the theory and evidence on corporate governance indicates several related themes. First, corporate governance is multidimensional. Second, corporate governance is an endogenous response to a firm’s economic environment. Third, the role of different governance mechanisms varies across industries. New analysis of a sample of 1235 US corporations from 40 different industries in the year 2000 confirms the empirical regularities reported in prior research. The central policy implication of the prior research and new supporting evidence is that one size does not fit all in corporate governance.     

Shareholder value and Financialization: consultancy promises,management moves

In the pages of the daily financial press, 'shareholder value' is a loose rhetoric. For business consultants who sell financial metrics and implementation, shareholder value is also a product and a promise that purposive management action will be rewarded. This paper begins by considering the consultant's promise and the more guarded academic responses. It then presents empirics on micro performance and the meso limits to shareholder value and argues that most corporate managements cannot easily deliver what consultants promise and the capital markets demand. The paper ends by taking a broader view of value-based management as part of a process of financialization. If the results are contradictory and disappointing, a persistent gap between expectations and outcomes can nevertheless drive management behaviours, which change the world.     

The effects of convergence: internationalization and the changing distribution of net value added in large German firms

The paper examines whether and how the increasing internationalization of firms impacts on the operation of a co-ordinated market economy. Following the tenets of agency theory, it assumes that an emerging market for corporate control changes the monitoring mechanisms that oversee management. Since Anglo-American forms of monitoring are usually associated with a higher return for investors compared with Continental European firms, a change in the distribution of the net value added of firms is expected. Using financial data on fifty-nine large German companies, the paper shows that the emerging convergence of German corporate governance practices to Anglo-American standards has had a weak, but significant, impact on the distribution of net value added. This is in contrast to the impact of the internationalization of firms on product markets, which does not have an effect. Since the market for corporate control is, however, still underdeveloped in Germany, the main effects remain to be seen.     

Economic Democracy and the Expediency of Worker Participation

The increased discussion of economic democracy in America in recent years makes sense given the context of crises in Keynesianism, the welfare state, corporate legitimacy and American 'competitiveness'. Departing from Dahl's recent analysis, this paper argues that one notion of economic democracy - the internal democratization of the firm - can be conceived and plausibly linked to objectives of increased American competitiveness and community stability. The argument rejects purist schemes of universal cooperative ownership as well as so-called shareholder democracy. It proposes a representative system for the firm based on a balance among shareholder, employee and community interests, a separation of powers between boards of directors and management, and a concept of transition based on democratic development of already widespread employee stock-ownership plans.     

社区股份公司的发展困境:逆向嵌入与信任消解——基于深圳市L区的实证研究

社区股份公司是城市集体经济的重要组成部分,对于城市的经济发展与空间拓展具有重要意义。面对现阶段我国多样的市场机会,社区股份公司却长期固守低端物业和租赁经济,经济发展模式单一,发展处于停滞状态。基于深圳市L区31家社区股份公司的实证研究,发现股民通过“出身”股权和宗族网络逆向嵌入社区股份公司,严重束缚了社区股份公司管理层的自主性。由于社区股份公司与地方政府缺乏有效的正式沟通渠道,以及过往合作质量较低等因素,极大地消解了双方的信任,社区股份公司不能很好地回应地方政府的扶持政策。未来需要从做实集体股份、完善公司治理、调整股权结构、重建信任机制以及提高政府服务质量等方面入手,破解社区股份公司的发展困境。     

The hijacking of a new corporate form? Benefit corporations and corporate personhood

Benefit corporations are a new type of corporate entity developed to remedy antisocial corporate behaviour by enabling mission-driven investors, managers and entrepreneurs to prioritize social values and contest the idea that profits are the only and best measure of corporate performance. To resocialize the corporate entity, the benefit corporation movement built enabling discourses and evaluation practices into the dominant model of corporate governance, shareholder value ideology. These discourses and practices expand both the purpose of the corporate entity and shareholders’ power to enforce that purpose. However, this paper argues that the effort to ‘re-embed’ the corporate entity by making it subject to non-economic claims expands the scope of corporate personhood and that doing so within extant power relations of the firm opens the door to alternative projects that undermine the benefit corporation movement's goal of fostering corporate social responsibility.     

“强县扩权”体制改革的文本分析

在发展县域经济的原动力下，我国诸多省份相继出台政策推行“扩大县（市）经济社会管理权限”改革，赋予县级政府地市级的经济社会管理权限，减少行政层级，成为探索“省直管县（市）体制”的又一路径和研究热点。通过分析各地政策文本中关于时间进程、改革目标、改革原则、改革内容、扩权方式与类型以及相应的配套措施等内容可以发现，由于“示范效应”的存在，各地在改革目标、改革原则、改革内容和扩权方式等方面存在着较大的共性，只有部分省份因地制宜地提出了有省情特征的改革举措，说明此项改革目前仍处于探索阶段，还有较大的完善空间。     

Economic Rationalism and Public Sector Ethics: Conflicts and Catalysts

Given recent focus on unethical activity and failings in corporate governance in the private sector, this paper briefly overviews the application of 'economic rationalism' in public administration and its impacts on the ethics of public sector decisions. It is argued that although 'unethical' decisions in public administration may be influenced by the economic imperatives embodied in 'economic rationalist' policies, it does not follow that the application of economic principles is necessarily inconsistent or injurious to ethical outcomes. In many instances the application of economic principles in public administration adds value by making existing ethical conflicts transparent and enabling more informed decisions.     

我国证券市场信息披露方面存在的问题与解决对策

描述了当前我国在引进证券市场的过程中,由于历史形成的社会经济基础和体制很难立即与全新的证券市场相匹配,造成现阶段我国证券市场虽然具备了现代证券市场的基本要素和发挥着基本的功能,但仍然存在一定的缺陷。作者从利益的牵引与驱动、公司内部治理结构失衡、信息不对称和信息披露指定媒体的弊端四个方面进行原因的探究并提出了相应的解决对策。     

Correspondence

The viability and desirability of a finance-led growth regime is first assessed against the historical evidence about the many alternative regimes that have been proposed as successors to Fordism. A purely hypothetical model is then built by assembling various hypotheses derived from the observation of current American trends. The imposition of financial norms, such as shareholder value, requires a new and coherent architecture for the mode of governance of firms, the form of competition, the wage labour nexus and the objectives of monetary policy, public budget and tax system. According to the model, any requirement for increased profit has a variable macro-economic impact on wages and economic activity according to the size of accelerator effects and the relative importance of wage and profit in income formation. The stability of an equity-based regime depends on monetary policy which controls financial bubbles and thus the diffusion of finance may push the economy into a zone of structural instability. The next major financial crisis may originate in the USA whose economy approximates most closely to the model. But, the so-called American 'new economy' combines diverse but interdependent structural transformations: diffusion of Information and Communication Technologies, search for new rules for competition, increased flexibility in wages and employment, shift from manufacturing to services. Finance is an element in, but not the whole of, this complex emerging regime.     

我国社会责任会计信息披露与监督

企业的目标是多元化的,随着社会经济的发展,企业社会责任观念渐入人心.作为"企业公民",企业履行社会责任是其各项活动中的一个重要方面.会计作为经济活动计量与监督的工具,理应担负起对企业社会责任计量与监督的使命.梳理了社会责任会计的起源及发展,分析了社会责任会计信息披露的现实意义,并对社会责任会计的披露内容及方式选择和社会责任会计信息披露的监管提出了建设性的建议.     

THE CORVAIR, THE PINTO AND CORPORATE BEHAVIOR: IMPLICATIONS FOR REGULATORY REFORM

Top corporate management responds to what is socially desirable when the costs and economic benefits provide the incentive to do so. Even when changing directions to match what is thought to be socially desirable would produce long-term profit maximization, some firms may stay with what is socially undesirable for what is perceived as a greater short-term profit maximization. Halpern suggests that such short-term profit decisions made by General Motors with the Corvair, and by Ford with the Pinto, backfired. A key problem is seen as the time lag between corporate misdeeds and the final judgment of courts or the government.     

Reorganising adjustment: Finland's emergence as a high technology leader

As attention has shifted to the topic of change in organised economies, Finland represents a valuable case study. The nation's leap from paper producer to high technology leader represents a unique opportunity to study restructuring within the confines of an allegedly incremental organised economy. To date, Finland's transformation has been interpreted as a product of sweeping liberal reforms in finance and corporate governance. This article, however, identifies an enduring role for collectively organised economic actors in labour market and technology policies. Cooperation in these arenas did not inhibit restructuring. On the contrary, collaborative technology policies actively facilitated the rapid redistribution of resources to an emerging ICT industry. In exploring the opportunities and constraints associated with these policies, this article not only sheds light on Finland's shift into high technology markets, but also identifies a more flexible role for coordination in the new economy.     

Puerto Rico: National security,economic growth and colonialism

Abstract

Puerto Rico's significance for the US state and imperialism has gradually deteriorated. In the context of recent global changes and new developments in the US political economy the logic that justified colonial control cannot be sustained. However, an array of counteracting political and economic forces are conspiring to overcome the altered material and geopolitical conditions that make evident the need for Puerto Rico's decolonization.

Colonialism has given rise to an array of forces that impedes any changes in Puerto Rico's formal political status. Where once the US state, corporate capital and the dominant political forces in Puerto Rico were in relative agreement on sustaining the colonial enterprise, a new constellation of competing forces has emerged. Within Puerto Rico proponents for the status, quo and those who agitate for statehood have reached virtual electoral parity. Monopoly “capital, primarily in Pharmaceuticals, dominates the local economy. However, it is challenged by North American unions and their congressional allies who seek to rescind the lucrative fiscal policies that account for these firms exorbitant profits. Agencies of the US state and congressional committees are at odds on what needs to be done to sustain an unmanageable, increasingly expensive and anachronistic colony.

This essay presents a framework for examining the array of forces and conditions that continue to erode the colonial relation and that explains colonialism's fragility in the current period of global readjustment.