Power and paradigms : the Dutch response to pressures for shareholder value

Bezemer, Pieter-Jan, Zajac, Edward J., Naumovska, Ivana, van den Bosch, Frans A.J., & Volberda, Henk W. (2015) Power and paradigms : the Dutch response to pressures for shareholder value. Corporate Governance : An International Review, 23(1), pp. 60-75.

[img] Accepted Version (PDF 233kB)
Administrators only | Request a copy from author

View at publisher

Abstract

In recent years, research aimed at identifying and relating the antecedents and consequences of diffusing organizational practices/ideas has turned its attention to debating the international adoption and implementation of the Anglo-American model of corporate governance, i.e., a shareholder-value-orientation (SVO). While financial economists characterize the adoption of an SVO as necessary and performance-enhancing, behavioral scientists have disputed such claims, invoking institutional contingencies in the appropriateness of an SVO. Our study seeks to provide some resolution to the debate by developing an overarching socio-political perspective that links the antecedents and consequences of the adoption of the contested practice of SVO. We test our framework using extensive longitudinal data from 1992-2006 from the largest listed corporations in the Netherlands, and we find a negative relationship between SVO adoption and subsequent firm performance, although this effect is attenuated when accompanied by greater SVO-alignment among major owners and a firm’s visible commitment to an SVO. This study extends prior research on the diffusion of contested organizational practices that has taken a socio-political perspective by offering an original contingency perspective that addresses how and why the misaligned preferences of corporate owners will affect (i) a company’s inclination to espouse an SVO, and (ii) the performance consequences of such misalignment.This study suggests when board members are considering the adoption of new ideas/practices (e.g., SVO), they should consider the contextual fitness of the idea/practice with the firm’s owners and their interests.

Impact and interest:

0 citations in Scopus
2 citations in Web of Science®
Search Google Scholar™

Citation counts are sourced monthly from Scopus and Web of Science® citation databases.

These databases contain citations from different subsets of available publications and different time periods and thus the citation count from each is usually different. Some works are not in either database and no count is displayed. Scopus includes citations from articles published in 1996 onwards, and Web of Science® generally from 1980 onwards.

Citations counts from the Google Scholar™ indexing service can be viewed at the linked Google Scholar™ search.

ID Code: 78568
Item Type: Journal Article
Refereed: Yes
Keywords: corporate governance;, practice/idea diffusion, ownership structure;, firm performance, the Netherlands, shareholder value orientation
DOI: 10.1111/corg.12093
ISSN: 1467-8683
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > BUSINESS AND MANAGEMENT (150300)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Accountancy
Copyright Owner: Copyright 2014 John Wiley & Sons, Inc
Deposited On: 10 Nov 2014 22:25
Last Modified: 09 May 2015 00:57

Export: EndNote | Dublin Core | BibTeX

Repository Staff Only: item control page