Accommodating Two Worlds in One Organization: Changing Board Models in Agricultural Cooperatives

27 Pages Posted: 4 Oct 2012

See all articles by W.J. Jos Bijman

W.J. Jos Bijman

Wageningen UR - Agricultural Economics Research Institute (LEI)

George W.J. Hendrikse

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); Erasmus Research Institute of Management (ERIM)

Aswin A.C.J. van Oijen

Tilburg University - Tilburg University School of Economics and Management

Date Written: August 8, 2012

Abstract

While most economic organisation literature on cooperatives has focused on changes in income rights, we study changes in the allocation of decision rights between board of directors (representing members) and managers. The traditional role of the board is to direct the activities of the managers. However, professional management increasingly makes most strategic decisions, pushing the board into a supervisory role. We present two groups of findings on changing board – management relationships. We identify three corporate governance models: traditional model, management model, and corporation model, and we present an empirical illustration showing a relationship between the choice of board model and product portfolio and performance.

Keywords: corporate governance, management, diversification, cooperatives, board

JEL Classification: L2, Q13

Suggested Citation

Bijman, W.J. Jos and Hendrikse, George W.J. and van Oijen, Aswin A.C.J., Accommodating Two Worlds in One Organization: Changing Board Models in Agricultural Cooperatives (August 8, 2012). ERIM Report Series Reference No. ERS-2012-015-ORG, Available at SSRN: https://ssrn.com/abstract=2156783

W.J. Jos Bijman (Contact Author)

Wageningen UR - Agricultural Economics Research Institute (LEI) ( email )

Burgemeester Patijnlaan 19
The Hague, 2502 LS
Netherlands
+31-70-3358218 (Phone)
+31-70-3615624 (Fax)

George W.J. Hendrikse

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Aswin A.C.J. Van Oijen

Tilburg University - Tilburg University School of Economics and Management ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

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