Reformed and engaged boards – not activist shareholders
AbstractThis study considers the legitimacy of shareholder activism as a means of exercising influence in the corporate decision-making process and identifies self-reformed boards as a superior solution to the issues that activists attempt to address. We conceptualise the board of directors' role as representing the interests of multiple principals. When any one principal is able to serve its own interests by influencing corporate decision-making through shareholder activism, other principals' interests may be compromised. We argue that a better long-term solution lies not with activist shareholders, but with culturally reformed boards. We suggest a set of self-reform initiatives that would help them to achieve their potential. We develop a conceptual framework for the arguments in favour of boards taking a leadership role in corporate engagement with shareholders and stakeholders. To the extent that boards are unable to implement self-reform, governments may need to develop public policy initiatives for corporate governance reform.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Inderscience Enterprises Ltd in its journal World Review of Entrepreneurship, Management and Sustainable Development.
Volume (Year): 7 (2011)
Issue (Month): 3 ()
Contact details of provider:
Web page: http://www.inderscience.com/browse/index.php?journalID=173
activists; shareholders; investors; multiple principal agency theory; engagement; corporate decision making; self-reformed boards; leadership; shareholder activism; board of directors; director role; public policy; corporate governance reform.;
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Graham Langley).
If references are entirely missing, you can add them using this form.