The Governance of Globalization

CORPORATE GOVERNANCE AND GLOBALIZATION, Three-Volume Set, Thomas Clarke, Marie Dela Rama, eds., SAGE Publications, 2006

26 Pages Posted: 23 Jun 2009 Last revised: 22 Jul 2009

See all articles by Thomas Clarke

Thomas Clarke

University of Technology, Sydney

Marie dela Rama

Management Discipline Group

Date Written: 2006

Abstract

The three volumes in this collection bring together critical, inter-disciplinary analyses that examine the dimensions of the central issues in corporate governance and globalization in definitive ways. How the original simple patterns of ownership and control have laborated into complex and competing governance systems is considered. The prolonged efforts of the developing economies to implement corporate governance reform are explored in the context of the rapid globalization of finance and production. Finally the tensions resulting from the irresistible forces for the convergence of governance colliding with a diversity of apparently immovable cultural institutions are investigated.

Volume 1: Ownership and Control surveys the diverse origins of corporate governance and how this has resulted in different models of capitalism. Pinto suggests that globalization stimulated the study of comparative corporate governance and that stakeholder models are associated with concentrated ownership, while diffuse ownership results in a more market oriented shareholder model. Gugler et al. examine how the different ownership and institutional structures have an impact on economic performance, and Dore rejects the imposition of a universal set of market based corporate control mechanisms. Finally, in their influential empirical study of corporate ownership around the world La Porta et al insist that in contrast to the Berle and Means image of the separation of ownership and control, in most economies firms continued to be owned by families or the state.

Volume 2: Development and Regulation explores the impact of international corporate governance reforms on the developing world, the influence of foreign direct investment, and the results of privatization initiatives. Claessens investigates the relationship between corporate governance and economic development through greater access to capital and better firm performance. The prevalence of pyramid corporate-ownership structures, cross shareholdings and dominant insider blockholders in the developing world allows the neglect of other shareholders. This is often reinforced by close relationships with political elites, when sound political governance is necessary to achieve reform in corporate governance. The attempt by the IMF and other international agencies to impose corporate governance standards from the outside is criticized by Soederberg as diverting attention from more substantial reforms while allowing the further entrenchment of ruling families. Redding addresses a more fundamental failure in Western agencies to understand the ethics of reciprocity and collective obligation at the heart of Asian enterprise. Finally Stiglitz emphasizes the importance of introducing integrated policies for finance, governance, technology, research and education if developing countries are to succeed, while avoiding the capital market liberalization that can lead to instability in the real economy.

Volume 3: Convergence and Diversity concentrates on the future direction of developments in corporate governance. An emphatic projection of the strong convergence thesis is offered by Nestor and Thompson, who refer to the pressures of direct competition in the product market which mandates a de facto convergence of cost structures and firm organization. Globalization of capital markets and new financial intermediaries that demand international corporations meet new governance standards. The same phenomena are analyzed from a very different perspective by O’Sullivan who acknowledges the expansion of the role of the stock market in both French and German corporations, but queries whether this new orientation can either satisfy stakeholders or enhance innovative capabilities in the way promised.

Keywords: Corporate governance, globalisation, ownership, control

Suggested Citation

Clarke, Thomas and dela Rama, Marie, The Governance of Globalization (2006). CORPORATE GOVERNANCE AND GLOBALIZATION, Three-Volume Set, Thomas Clarke, Marie Dela Rama, eds., SAGE Publications, 2006. Available at SSRN: https://ssrn.com/abstract=1423010

Thomas Clarke

University of Technology, Sydney ( email )

Haymarket Campus
PO BOX 123 Broadway
Sydney, New South Wales 2007
Australia
+61 2 9514 3479 (Phone)
+61 2 9514 3817 (Fax)

HOME PAGE: http://www.ccg.uts.edu.au

Marie Dela Rama (Contact Author)

Management Discipline Group ( email )

Haymarket Campus
PO BOX 123 Broadway
Sydney, New South Wales 2007
Australia
+61 2 9514 3635 (Phone)

HOME PAGE: http://twitter.com/corpgovresearch

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