Jaime Guerrero-Villegas

Corporate governance changes, firm strategy and compensation mechanisms in a privatization context

Purpose – The purpose of this paper is to analyze certain organizational changes that occur after privatization. More specifically, the authors analyze from an agency theory perspective how changes at the corporate governance level (ownership type/structure and board of directors) influence firm strategy, and what implications these issues have for the design of compensation mechanisms. Design/methodology/approach – The methodology employed in the study can be described as a longitudinal multiple case study approach. A multiple case study enables the comparison of pre- and post-privatization periods in five Spanish companies. This methodology is especially suitable to track the organizational changes occurring in relation to the firms’ internal management. Findings – First, the variables that traditionally relate to greater board independence in monitoring do not suffer from variation after privatization. Second, the interests of the firms’ new ownership have an impact on firm strategy after privatization...

Ownership concentration and firm performance: the moderating effect of the monitoring and provision of resources board roles

ABSTRACT This paper explores the effect that the monitoring and the provision of resources board roles have on the relationship between ownership concentration and firm performance. The sample of this study is made up of 579 European firms registered on the STOXX Europe 600 index during the period 2002–2011. The results of this study show that the monitoring provided by the board positively influences the effect that ownership concentration has on performance. The results also highlight that the moderating effect of the provision of resources role has a positive influence on firm performance concerning almost all levels of ownership concentration, diminishing and having slightly negative effects when the concentration levels are extremely high.

Reputation of multinational companies: Corporate social responsibility and internationalization

Purpose The purpose of this paper is to use stakeholder theory as the theoretical reference framework to study the influence of internationalization (geographic international diversification) and social performance on multinational companies’ (MNCs) reputation. Design/methodology/approach The authors confirm the research hypotheses using a sample of 113 US MNCs in the chemical, energy and industrial machinery sectors during the period 2005-2010. Findings This study contributes to the literature in three ways. First, it incorporates literature on internationalization to study the possible connection between geographic international diversification and social performance in MNCs. Second, it sheds light on the debate between corporate social responsibility (CSR) and the reputation of MNCs in a very diverse transnational context in which MNCs must meet the needs of stakeholders at both local and global levels. Third, it incorporates the mediating role of social performance in the relationship between geographic international diversification and the firm’s reputation. Originality/value Prior studies have hardly analyzed this relationship, which becomes especially relevant for MNCs, since their implementation of advanced CSR practices in the different markets in which they operate will gain them a good reputation, not only in specific local contexts but also globally, benefitting the organization as a whole and enabling it to gain internal consistency (improvement in internal efficiency), transparency and legitimacy.

Comparison of corporate governance, strategy, control and performance e valuation systems before and after privatization

The aim of this paper is compare corporate governance and firm strategy before and after privatization. The design of control and performance evaluation systems in the pre and post-privatization periods is compared so that it can be understood in relation to the changes observed at a high corporate level (corporate governance and firm strategy). We carry out various case studies on five privatized Spanish companies. The results support several conclusions. First, the variables that are traditionally related to greater board independence in monitoring do not undergo variation after privatization. Second, the interests of the firms’ new ownership have an impact on firm strategy after privatization. Finally, control and performance evaluation system designs clearly align with firm strategy after privatization.

Corporate Governance in Emerging Markets: What We Can Learn from a Privatisation Context

This chapter analyses the changes observed in the corporate governance of companies after privatisation. Specifically, the study focuses on the analysis of how boards change their two main functions – control and provision of resources – when the company is transferred from public to private hands. This serves as a reference to emerging countries that use privatisation as a mechanism for economic development. Regarding the control function, the study shows the key role played by directors appointed before the Chief Executive Officer (CEO) in monitoring managers. This study also establishes the influence of external factors – such as regulation and competition in the sector – on the control function. Regarding the provision of resource role, the results highlight the importance of changing the configuration of the boards after privatisation – in terms of the profile of the directors – in order to acquire the necessary resources in the private stage of the firm. In this respect, the study indicates that directors who are business experts play a greater role after privatisation, and highlights the important presence of support specialists with specific skills at each stage of the company. The study also emphasises the limitations of some variables traditionally associated with the control function – leadership structure (non-duality) and outside directors – and with the provision of resources role – board size.