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The Board of Directors and its Role in the Corporate Governance System - Considerations about the Control Model - A Research Note

Author

Listed:
  • Thomas Gstraunthaler

    (Department of Accounting, Auditing and Taxation, University of Innsbruck, Austria)

  • János Lukács

    (Matthias Corvinus University, Budapest, Hungary)

  • Marcel Steller

    (Department of Accounting, Auditing and Taxation, University of Innsbruck, Austria)

Abstract

The paper examines the corporate governance mechanism of the control model (or insider control system) by looking at both the motivation for management to deviate from following their principal’s wishes and whether the supervising body, the board of directors would correct them. Some opportunistic actions deriving out of the principle-agent relation between owners and management are preventable; others are not and can only be minimized by a strong participation of the owner in the affairs of the company

Suggested Citation

  • Thomas Gstraunthaler & János Lukács & Marcel Steller, 2008. "The Board of Directors and its Role in the Corporate Governance System - Considerations about the Control Model - A Research Note," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 1(1), pages 37-54, April.
    • Handle: RePEc:tei:journl:v:1:y:2008:i:1:p:37-54
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    References listed on IDEAS

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    Cited by:

    1. Emilia VASILE & Ion CROITORU, 2016. "Organisations Overseeing through the Audit Committee," Hyperion Economic Journal, Faculty of Economic Sciences, Hyperion University of Bucharest, Romania, vol. 4(2), pages 3-10, June.
    2. Christiane Pott & Tobias Tebben & Christoph Watrin, 2014. "The effect of outside directors’ and auditors’ incentives on managers’ ability to manage cash bonuses," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 18(2), pages 505-540, May.
    3. Rita Vieira & Graça Azevedo & Jonas Oliveira, 2024. "Systematic review in financialization politics: the role of corporate governance and managerial compensation," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 21(3), pages 376-405, September.
    4. Simeon Karafolas, 2013. "Public financial support to investments in rural areas: The case of the region of Thessaly in Greece," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 6(2), pages 81-101, September.

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    More about this item

    Keywords

    Supervisory Board Effectiveness; Control Model; Incentives;
    All these keywords.

    JEL classification:

    • 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
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation

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