New Directions for Corporate Governance: A Comparative Capitalisms Perspective

New Directions for Corporate Governance: A Comparative Capitalisms Perspective compares different corporate-governance systems and evaluates those systems in terms of different aspects of organizational performance not just shareholder returns. Combining this approach with insights from the comparative capitalisms literature, this monograph shows how different corporate-governance systems give rise to inherently different types of company that vary in their purpose, relative focus on profits, tendencies to invest in training for various groups of employees, and stewardship of the natural environment. The monograph begins with an overview of the shareholder-primacy view of corporate governance. The next section sets out in detail how, at an ontological level, the comparative-capitalisms perspective on corporate governance differs from the shareholder-primacy approach. Section 3 highlights the implications for analytical foci and methods. The next section provides a summary of relevant research in two separate thematic areas, employee-related issues and environmental investments highlighting the importance of taking the diversity of institutional investors into consideration in analyses of various firm outcomes. Section 5 discusses the rise of asset management funds as well as other alternative investors and highlights how financialization may increase ownership of firms by asset managers doing little to reduce senior managers’ priorities to short-term financial performance. The next sections (6-8) highlight the growing prominence of other owners and controllers of firms beyond asset managers including the prominence of other types of firm beyond listed companies whose shares dispersed institutional investors own. Section 9 highlights the difficulty of discerning some firms’ ‘nationality’, and, hence, the difficulty of identifying the owners of those firms as well as the owners’ institutionally conditioned objectives. The final section provides conclusions.