The emergence of corporate governance in big business 19th-20th century
Corporate governance, by its very name, implies that corporations may differ from one another in their power structure and function. Laws, conventions, social structures, affect both formal and informal corporate governance. Corporate governance may be seen as a prism where interests and aspirations pass through, and no wonder that the recent surge in studies of national varieties of capitalism focusses on corporate governance.
Much of corporate governance research is concerned with what economists call the principal-agent problem, namely that hired hands, managers, have other interests than owners, the principals. The classic 1932 analysis of Berle and Means claimed that US managers had taken over the power of the development of the corporation, raising serious issues of power distribution inside the society as a whole. Managerial capitalism they called it, a theme that has become important as economists have criticized managerial power for prioritizing themselves and investments not in the interest of the shareholders. After them, economists as Robin Marris (1959) elaborated about the notion of managerial self-interest.
In economic and business history, Alfred Chandler partially turned Berle and Means on their head. Managerial capitalism, claimed Chandler, was a meritocratic revolution where teams of highly qualifies and educated leaders turned personally oriented and competitive capitalism into sleek and big corporations. These corporations had the ability to both innovate with new products and bring them to mass markets with prices that seriously undercut what personal capitalism could achieve.
Big business was the inescapable response to a technological shift, known also as the second industrial revolution, which made large dimension and throughput compulsory concepts in scale intensive industries. And big business diffused everywhere – however, with a range of different governance arrangements, in terms both of ownership and of power management inside and outside the firm.
This session aims to address the coming of big business and the way it was governed in a variety of countries. The emphasis is on understanding how and why corporate governance emerged differently in different countries. The perspectives will be many and include the influence of business law, of trade unions, political developments as well as international relations of both countries and companies.
- Knut Sogner, BI Norwegian Business School, email@example.com, Norway
- Andrea Colli, Bocconi University, firstname.lastname@example.org, Italy
- Andrea Colli, Bocconi University, email@example.com
- Knut Sogner, BI Norwegian Business School, firstname.lastname@example.org
- Harold James, Princeton University, hjames@Princeton.EDU
- Randall Morck, Alberta School of Business, email@example.com
- Abe de Jong, Rotterdam School of Management, firstname.lastname@example.org
- Mary O'Sullivan, University of Geneva, email@example.com
- Leslie Hannah, LSE, firstname.lastname@example.org
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