Naohito Abe Tatiana G. Dolgopyatova Ichiro Iwasaki
Abstract
The vast majority of Russian corporations, including many manufacturing and communications firms, are still compelled to become closed joint-stock companies that lack a modern democratic mechanism in order to attract capital from a wide range of private investors. This is due to factors such as significant insider ownership, a strong orientation among managers toward closed organizations, slumping needs for corporate finance, and underdeveloped local financial institutions. The impact of ownership structure on corporate-form choice by Russian firms exists, even if we assume that the two elements are determined endogenously. Under these circumstances, however, a significant number of closed companies attempt to develop more open internal organizational structures that are virtually the same as those in open companies. Nonetheless, such an institutional coupling of a closed corporate form and an open internal organizational structure is far from effective in resolving the imminent governance problems facing Russian corporations, such as the prevention of infighting among executives and outside shareholders and the implementation of discipline among top management.
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Publisher Info
Paper provided by Institute of Economic Research, Hitotsubashi University in its series Discussion Paper Series with number
b36.