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- Jansson, Andreas, et al.
(author)
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The role of mass media in corporate governance : a study of how Swedish corporations are affected by the character of publicity
- 2016
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Conference paper (peer-reviewed)abstract
- Large corporations are the objects of large amounts of media attention. Despite this, the literature pertaining to the role the media may play in shaping corporate governance structures and processes is at a fairly rudimentary state (Bednar, 2012). The media has, nevertheless, variously been portrayed as an ally to shareholders that monitors and reports corporate misbehavior (e.g., Dyck & Zingales, 2008); as an agenda setter that shapes priorities in corporate decision making and corporate reputations (e.g., Carrol & McCombs, 2003); as a propagator of legitimacy defining acceptable corporate behavior (Bednar, 2012; Jansson, 2013); and as an arena for collective meaning making of corporate events (Jansson, in press). While the literature converges on the idea that the media by ‘naming and shaming’ certain practices can delegitimate corporations and thereby change corporate behavior, issues such as whether variation in types of publicity creates varying outcomes and how institutional differences affect the impact of the media on large corporations, remains largely unresolved.In this paper we report a study of how various types of publicity in the press affects corporate governance in large Swedish listed firms. Building on previously published instruments, we develop and validate an instrument for capturing the intensity of both positive and negative publicity using quantitative content analysis that we apply to Swedish print media pertaining both to the firm and its CEO specifically over the period 1999-2013. We analyze the impact of this publicity on corporate governance in terms of CEO resignation and CEO pay level as well as distribution.Interestingly, our tentative results suggest that neither positive nor negative publicity on the CEO or the corporation affects either CEO resignation or CEO pay level and distribution. Thus, our results do not conform to previous research having established the importance of media as a gate-keeper. Whereas Bednar (2012) questions the role of media as watchdog in that largely symbolic actions may have important corporate effects, we instead find that media reports have no effect at all. A possible explanation for this may be that the information reported in media is already well-known to the business society, therefore having no effect when published. This is perhaps not very surprising given how close-knit Swedish business relations are (Sinani et al., 2008) and indeed how close the relations between Swedish corporations and the business press tend to be (Grünberg & Pallas, 2013).Our paper contributes to the literature on the role of media in corporate governance in illustrating how patterns of response to media attention among Swedish firms differ from that of U.S. firms, suggesting that while the media may function as propagators of legitimacy, the underlying normative model propagated may differ among national contexts, implying that the media will have different outcomes in different parts of the world (cf. Jansson, 2013) and indeed sometimes no results at all.
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- Holgersson, Martin, et al.
(author)
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Shareholder value orientation : grand unified business theory or window-dressing?
- 2015
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In: Presented at the 27th SASE Annual Conference, London, UK, July 2-4, 2015.
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Conference paper (peer-reviewed)abstract
- Previous research has shown that sociopolitical context is important for adoption of shareholder value-oriented practices in terms of owner and manager preferences (Fiss & Zajac, 2004). This turn of research and its focus on owners has further been elaborated on by for example Chizema & Shinosawa (2012) and Zattoni & Minichilli (2009) as well as by Saunders & Tuschke (2007) and Shipilov et al. (2010) when it comes to the importance of firm networks. The purpose of this paper is to continue to explore why firms adopt shareholder value practices and especially so in traditional stakeholder governance system. Drawing on institutional theory, we develop a model of firm adoption of shareholder value practices which emphasizes the two sociopolitical features of different ownership types and board networks.The model is tested on all Swedish listed companies 1995 to 2010 in five-year intervals. Furthermore, we specifically choose to study the two separate practices of using a dual-share system or not and executive incentive plans, as they are both closely connected to an agency-theory perspective and shareholder value orientation, but are very different in how upsetting one may assume them to be to the incumbent corporate governance system.Our findings show that a shareholder value orientation seems to have taken root in Swedish companies, but that different aspects of the concept are affected by different actors, making the traditional Swedish blockholders and board networks vital although in separate ways. When it comes to the practice of equity incentive-based executive compensation, this is closely related to firm relations in terms of both board interlocks and board centrality. Thus, social networks seem to drive this practice. When it comes to using a one-share-one-vote system (rather than as traditional in Sweden A- and B-shares), social networks seem to have no importance at all. Instead, what is closely related to the adoption of such a non-traditional system is whether there are strong blockholders or not and of which type this owner is, as family and sphere blockholding is negatively related to one-share-one-vote, whereas institutional and foreign blockholding is positively related to it. Thus, non-system-threatening practices are readily diffused through social networks, as tends to be the case with symbolic action, but system-threatening practices are met with resistance from incumbent powerful actors.We suggest that rather than hypothesis-testing of different variables, the contribution of our paper lies in its teasing out of different patterns for different shareholder value orientation practices, as it may help explain the different results in previous studies in similar European contexts. For where Fiss & Zajac (2004) emphasize their findings on the importance of owners (and the non-importance of networks), Sanders & Tuschke (2007) as well as Zattoni & Minichilli (2009) in contrast emphasize the non-importance of owners and in the first case the importance of networks, which are unfortunately not included in the latter one. The explanation for these diverging results may then be found in the dependent variable, as who is invested (or not) in the practice may determine its adoption.
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- Jonnergård, Karin, et al.
(author)
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Corporate control and regulation : The explain mechanism as a sign of "capture"
- 2019
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Conference paper (peer-reviewed)abstract
- Corporate governance regulation is a contested area. The dispersion of corporate governance codes could on the one hand be seen as a regulator capture performed by international institutional investors, but on the other hand as support for status quo favoring strong local interests, due to local adaptation of code content. In this paper, these competing explanations are empirically tested through the analysis of noncompliance in number of explanations by Swedish listed corporations with different corporate control arrangements. The main findings are that corporations with a concentrated “Swedish” control situation (i.e. controlling shareholder holding more than 50% of the votes) comply more with the code and provide significantly less explanations than other corporations, whereas corporations controlled by owners in the range of 20 to 50% (which would then represent the typical Swedish business group arrangement) comply less with the code and provide significantly more explanations, as do to some extent (but not as robustly) corporations with dispersed ownership (or an “Anglo-American” control situation). This indicates that the Swedish code through a series of adaptations of the international blueprint favors very strong local controlling shareholders. This is to some extent surprising, as the process of code development was set up to favor controlling shareholders with more moderate stakes. Nevertheless, it is of course to some extent logical that the code would also favor the strongest actors in the Swedish corporate governance system. Still, the strongest effect on code compliance (or not) seem to derive not from ownership concentration and type, but from board and CEO characteristics, traditionally associated with their relative power structure. These findings have implications for how corporate governance codes should be understood in a global setting and what roles such codes could perform in a reform process aiming to change corporate governance arrangements.
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- Jonnergård, Karin, et al.
(author)
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Corporate control and regulation : The explain mechanism as a sign of "capture"
- 2019
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Conference paper (peer-reviewed)abstract
- Corporate governance regulation is a contested area. The introduction of a corporate governance code could, on the one hand, be understood as a regulatory capture performed by international institutional investors, but on the other hand, as the introduction of a code tend to involve local adaptations it could be understood as support for status quo, and hence favoring strong local interest groups. In this paper, these competing explanations are empirically tested through the analysis of non-compliance by Swedish listed corporations with different corporate control arrangements. The main findings are that corporations with a concentrated “Swedish” control situation (i.e. controlling shareholder holding more than 50% of the votes) explain significantly more than corporations with other ownership arrangements, whereas corporations with dispersed ownership (“Anglo-American” control situation) explain significantly less. This could be interpreted as that the Swedish code - regardless of controlling shareholder involvement in the regulatory process - favor corporate governance arrangements based on dispersed ownership, and hence a control situation that international institutional investors are familiar with. These findings have implications for how corporate governance codes should be understood in a global setting and what roles such codes could perform in a reform process aiming to change corporate governance arrangements.
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