Understanding an Emergent Diversity of Corporate Governance and Organizational Architecture: An Essentiality-Based Analysis

Posted: 22 Jun 2008

See all articles by Masahiko Aoki

Masahiko Aoki

Stanford University

Gregory Jackson

Freie Universität Berlin

Date Written: February 2008

Abstract

This article proposes a simple framework for understanding an emergent diversity of linkages between corporate governance (CG) and organizational architecture (OA). It distinguishes discreet modes of their linkage by different combinatorial patterns between three basic assets: managers’ human assets (MHA), workers’ human assets (WHA), and non-human assets (NHA). Using the concept of essentiality of human assets proposed by Hart () and distinguished from that of complementarities, we first propose a new characterization of four known modes of CG-OA linkage: three traditional (Anglo-American, German, and Japanese) and one relatively new (Silicon Valley) models. Then we present empirical evidences of emergent diversity of CG-OA linkages in Japan, which is somewhat at odds with the old Japanese model. We interpret its emergent dominant mode as the path-dependent evolution of a new pattern of essentiality between human assets, made viable by lessening of institutional-complementarity-constraints, which surrounded the traditional Japanese model. We argue that this new mode interpreted in terms of essentiality may have broader applicability beyond Japanese context.

Suggested Citation

Aoki, Masahiko and Jackson, Gregory, Understanding an Emergent Diversity of Corporate Governance and Organizational Architecture: An Essentiality-Based Analysis (February 2008). Industrial and Corporate Change, Vol. 17, Issue 1, pp. 1-27, 2008, Available at SSRN: https://ssrn.com/abstract=1149235 or http://dx.doi.org/10.1093/icc/dtm037

Masahiko Aoki (Contact Author)

Stanford University ( email )

E314 Encina Hall
Stanford, CA 94305-6015
United States
415-723-3975 (Phone)
415-725-5702 (Fax)

HOME PAGE: http://www.stanford.edu/~aoki

Gregory Jackson

Freie Universität Berlin ( email )

Boltzmannstrasse 20
D-14195 Berlin, 14195
Germany

HOME PAGE: http://www.wiwiss.fu-berlin.de/institute/management/jackson/team/gjackson/index.html

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