Shareholder Wealth vs. Stakeholder Interests? Evidence from Code Compliance Under the German Corporate Governance Code

In order to better differentiate the drivers of corporations’ actions, in particular shareholder wealth and stakeholder interests, the paper explores the significance of the comply or explain-principle and its underlying enforcement mechanisms more generally. Against this background, compliance rates with specific provisions may shed a light on companies’ reasons for following the code. An analysis of these rates at the example of distinct provisions of the German Corporate Governance Code is therefore entered into. In light of the current corporate governance debate and the legitimacy problems that are raised, among the code provisions that exemplify these questions very well are those regulating incentive pay, severance pay caps, and age limits for supervisory board members. Their analysis will lay a basis for an answer to the question about what motivates companies to comply with the code. The motivation then paves the way to arrive at a further specification of the determinants of the regulatory evolution of the Code and the range of stakeholders and their concerns that enter into it

Corporate governance and management practices: stakeholder involvement, quality and sustainability tools adoption: evidences in local public utilities

Local public services is the field in which New Public Management (NPM) and Public Governance (PG) issues are most in evidence. The local public services are characterized by the rethinking of the role played by local government in the provision of services. An evolution has taken place. From a traditional configuration in which local public services were managed by local governments they moved to a configuration where it takes place a separation between the local government role (which continues to be the guarantor of the satisfaction of public needs) and the role of local public utilities (LPUs) (responsible for delivering the services). This transformation implies both the delegation of resources and authority to lower organisational levels within the public sector and the reconfiguration of accountability chains between the state institutions and the society. In recent years, an intense debate has developed regarding the introduction of new tools and control systems. Particular attention has been paid to planning and control systems, human resources management systems, and performance management systems, leaving a few pioneers to develop their analysis on corporate governance mechanisms with regard their relationships with both the external (stakeholders) actors and the internal (management) ones. On one hand, the OECD wrote guidelines in order to ensure good corporate governance practices, focusing on relations with stakeholders. On the other hand, the dialogue between corporate governance and stakeholders has been already tackled by a number of International organizations guidelines or principles, following a debate on corporate governance that has progressively combined a stakeholder perspective with a more classic shareholder-maximizing model of governance. This article contributes at the debate on the stakeholder involvement process. By means of both a theoretical discussion and an empirical research conducted on 37 Italian LPUs, this paper attempts to analyse specific management tools which can be used to improve the quality of corporate governance in LPUs, through the enlargement of the stakeholder involvement. Some NPM’s tools, such as quality standards and sustainability tools imply an effort to offer new forms of organizational behaviour in the decision-making processes (i.e. the choice of the performance indicators and the reporting tools) and may create a dialogue between the enterprise and its stakeholders. In particular, in our study we focus on the adoption of quality standards (ISO 9000 and Customer Satisfaction) and sustainability tools (sustainability reports and ISO 14000 standard) as NPM’s tools to facilitate the stakeholder involvement practices