Twenty-First Century Corporate Governance: The World Turns from West to East - An Essay for Professor John Farrar
Auckland University Law Review (New Zealand), Forthcoming
30 Pages Posted: 28 Aug 2014
Date Written: August 25, 2014
Prompted by a seemingly shift in geographical focus, I have written about the changes I have detected in the 20 plus years that John Farrar and I have been colleagues, teaching corporate governance at the University of Melbourne (Australia). They include: 1. The emergence of “emerging markets” (Indonesia, the PRC, the BRIC nations (Brazil, Russia, India and China)) and further emergence of so-called “frontier markets” (Vietnam, Pakistan, Mongolia, Romania, Kazakhstan). 2. Reprise of the two-tiered board structure, once thought to be uniquely German and mainly for purposes of labor representation. 3. Realization that, worldwide, most capitalism is dominant shareholder (family, state-owned) rather than the dispersed shareholder capitalism of the UK or the US, which presents an altogether different challenge for governance. What are those challenges? 4. Turning from capital to labor, the plantation production phenomenon and where it might lead. 5. Monitoring and management of risk, especially as a board responsibility, quickly moving to center stage. 6. Sustainability rather than profit maximization and shareholder values emergence as the watchword in the Twenty-First Century. 7. Board composition and board diversity, most particularly an increase in women on corporate boards of directors and in senior management positions.
Keywords: corporate governance, boards of directors, two-tiered boards, board diversity, emerging markets, frontier markets, sustainability, board committees, risk management, risk management committee, SOEs, dominant shareholders, family capitalism, dominant shareholder capitalism, gender and the board
JEL Classification: K22, D81, G34, P19
Suggested Citation: Suggested Citation