Board Structure Variety in Cooperatives

14 Pages Posted: 1 Jun 2022

See all articles by George W.J. Hendrikse

George W.J. Hendrikse

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

Jerker Nilsson

Swedish University of Agricultural Sciences (SLU)

Date Written: May 30, 2022

Abstract

This paper investigates why agricultural cooperatives exhibit different principles for the allocation of decision rights between the Board of Directors and the Management. A mass-action interpretation of the Nash equilibrium in an investment proposal game shows that, on the one hand, board structure variety is an equilibrium outcome while, on the other, the Traditional model (the board has full control) and the Management model (the professional management makes up the Board of the cooperative society) perform better than the Corporation model (the Management is in full control of the cooperative firm).

Keywords: internal governance, board of directors, management, decision rights, game theory

Suggested Citation

Hendrikse, George W.J. and Nilsson, Jerker, Board Structure Variety in Cooperatives (May 30, 2022). ERIM Report Series Reference, Forthcoming, Available at SSRN: https://ssrn.com/abstract=4122998 or http://dx.doi.org/10.2139/ssrn.4122998

George W.J. Hendrikse (Contact Author)

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

Jerker Nilsson

Swedish University of Agricultural Sciences (SLU) ( email )

S-901 83 Umea
Sweden

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