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The Political Paradox of Finance Capitalism: Interests, Preferences, and Center-Left Party Politics in Corporate Governance Reform

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Listed:
  • John W. Cioffi

    (University of California, Riverside, john.cioffi@ucr.edu)

  • Martin Höpner

    (Max Planck Institute for the Study of Societies in Cologne, Germany, hoepner@mpifg.de)

Abstract

A striking paradox underlies corporate governance reform during the past fifteen years: center-left political parties have pushed for pro-shareholder corporate governance reforms, while the historically pro-business right has generally resisted them to protect established forms of organized capitalism, concentrated corporate stock ownership, and managerialism. Case studies of Germany, France, Italy, and the United States reveal that center-left parties used corporate governance reform to attack the legitimacy of existing political economic elites, present themselves as pro-growth and pro-modernization, strike political alliances with segments of the financial sector, and appeal to middle-class voters. Conservative parties’ established alliances with managers constrained them from endorsing corporate governance reform.

Suggested Citation

  • John W. Cioffi & Martin Höpner, 2006. "The Political Paradox of Finance Capitalism: Interests, Preferences, and Center-Left Party Politics in Corporate Governance Reform," Politics & Society, , vol. 34(4), pages 463-502, December.
    • Handle: RePEc:sae:polsoc:v:34:y:2006:i:4:p:463-502
    DOI: 10.1177/0032329206293642
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    References listed on IDEAS

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    1. Paul Bridgen & Marek Naczyk, 2019. "Shareholders of the World United? Organized Labour's Preferences on Corporate Governance under Pension Fund Capitalism in the United States, United Kingdom and France," British Journal of Industrial Relations, London School of Economics, vol. 57(3), pages 651-675, September.
    2. Sandra Eckert, 2018. "Two spheres of regulation: Balancing social and economic goals," Regulation & Governance, John Wiley & Sons, vol. 12(2), pages 177-191, June.
    3. Anke Hassel & Bruno Palier, 2021. "Tracking the Transformation of Growth Regimes in Advanced Capitalist Economies," Post-Print hal-03380959, HAL.
    4. Butzbach Olivier & Rotondo Gennaro & Desiato Talita, 2020. "Can banks be owned?," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 10(1), pages 1-21, March.
    5. Florence Dafe & Zoe Williams, 2021. "Banking on courts: financialization and the rise of third-party funding in investment arbitration," Review of International Political Economy, Taylor & Francis Journals, vol. 28(5), pages 1362-1384, October.
    6. Emiliano Grossman & Cornelia Woll, 2014. "Saving the Banks: The Political Economy of Bailouts," SciencePo Working papers Main hal-02186491, HAL.

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