Corporate Governance Beyond the Shareholder and Stakeholder Model

Forthcoming in Erasmus Law Review

17 Pages Posted: 17 Oct 2022 Last revised: 10 Feb 2023

See all articles by Dirk Schoenmaker

Dirk Schoenmaker

Rotterdam School of Management, Erasmus University; Erasmus Research Institute of Management (ERIM); Centre for Economic Policy Research (CEPR)

Willem Schramade

Nyenrode Business University

Jaap W. Winter

Vrije Universiteit Amsterdam; University of Amsterdam; Insead

Date Written: February 10, 2023

Abstract

There is a heated debate on shareholder versus stakeholder governance. The debate has expanded from traditional stakeholders who are directly involved with the company, such as employees and customers, to stakeholders who are indirectly affected by the company’s conduct, for example through ecological damage and climate change, including future stakeholders. But the lack of an integrated measure makes it difficult to hold the board accountable against multiple goals. This paper develops an integrated model of corporate governance including current and future stakeholders, building on an integrated measure for corporate value. The board can use this integrated value measure to balance the interests of the various stakeholders in a structured way. The integrated value measure can also be used by stakeholders (including shareholders) to hold the board accountable for its decisions. Finally, the paper examines mechanisms, such as stakeholder councils and sustainability-related performance pay, to include the interests of the various stakeholders on the board.

Keywords: Corporate governance, shareholder model, stakeholder model, sustainability

JEL Classification: K22, G31, G34

Suggested Citation

Schoenmaker, Dirk and Schramade, Willem and Winter, Jaap W. and Winter, Jaap W., Corporate Governance Beyond the Shareholder and Stakeholder Model (February 10, 2023). Forthcoming in Erasmus Law Review, Available at SSRN: https://ssrn.com/abstract=4238927 or http://dx.doi.org/10.2139/ssrn.4238927

Dirk Schoenmaker (Contact Author)

Rotterdam School of Management, Erasmus University ( email )

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

HOME PAGE: http://www.rsm.nl/people/dirk-schoenmaker/

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Willem Schramade

Nyenrode Business University ( email )

Straatweg 25
P.O. Box 130
Breukelen, 3620 AC
Netherlands

Jaap W. Winter

University of Amsterdam ( email )

Oude Manhuispoort
Amsterdam
Netherlands

Vrije Universiteit Amsterdam ( email )

De Boelelaan 1105
Amsterdam
Netherlands
+31653978419 (Phone)

Insead ( email )

Boulevard de Constance
77305 Fontainebleau Cedex
France

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
553
Abstract Views
1,528
Rank
94,165
PlumX Metrics