Corporate Governance, Managers’ Independence, Exporting And Performance Of Firms In Transition Economies
AbstractUsing data on 157 large companies in Poland and Hungary this paper employs Bayesian structural equation modeling to examine interrelationships between corporate governance, managers’ independence from owners in terms of strategic decision-making, exporting and performance. It is found that managers’ independence is positively associated with firms’ financial performance and exporting. In turn, the extent of managers’ independence is contingent on the firm’s corporate governance parameters: it is negatively associated with ownership concentration, but positively associated with the percentage of foreign directors on the firm’s board. We interpret these results as an indication that (i) risk averse, concentrated owners tend to constrain managerial autonomy at the cost of the firm’s internationalization and performance, (ii) board participation of foreign stakeholders, on the other hand, enhances the firm’s export orientation and performance by encouraging executives’ decision-making autonomy.
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Bibliographic InfoPaper provided by CENTRE FOR THE STUDY OF ECONOMIC AND SOCIAL CHANGE IN EUROPE,School of Slavonic and East European Studies,University College London (SSEES,UCL) in its series Working Papers with number 62.
Length: 25 pages
Date of creation: Jan 2006
Date of revision:
corporate governance; strategic independence; exporting; performance;
Other versions of this item:
- Igor Filatotchev & Natalia Isachenkova & Tomasz Mickiewicz, 2007. "Corporate Governance, Managers' Independence, Exporting, and Performance of Firms in Transition Economies," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 43(5), pages 62-77, October.
- Igor Filatotchev & Natalia Isachenkova & Tomasz Mickiewicz, 2005. "Corporate Governance, Managers’ Independence, Exporting And Performance Of Firms In Transition Economies," William Davidson Institute Working Papers Series wp805, William Davidson Institute at the University of Michigan.
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
- P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions
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