Michael J. Rubach

Comparative corporate governance: Competitive implications of an emerging convergence

Corporate governance scholarship posits that the governance structure of a firm affects its competitive performance. As governance structures and systems initially developed, differing legal, financial, and cultural factors caused them to vary. Divergent paths resulted in multiple governance forms. Presently, evidence is growing that these governance systems are changing and are beginning to look more alike. This convergence can be viewed as the adoption of the best practices of the existing systems. During convergence, some firms can gain competitive advantage by altering their governance structures to incorporate elements that global stakeholders appear to value. This is true for companies in both emerging and established economies.

The enactment of corporate governance guidelines: an empirical examination

Purpose – The purpose of this paper is to examine the stock price reaction to the first announcement in SEC filings of the enactment of corporate governance guidelines. Agency and management theories suggest the enactment of guidelines should create value for the owners.Design/methodology/approach – The paper uses an event study methodology on a sample of 141 firms.Findings – The research finds only a few firms exhibited a significant reaction. Overall, the data were not significant. Searching for first‐ or late‐mover advantages was also unsuccessful. However, the increased enactment of guidelines (bandwagon effect) supports first order imitation possibly due to the board interlocks found. The results indicate two possible explanations. First, SEC filings may not be a strong signal for the overall market resulting in a potentially unrealized stock value transferred to those few who act on the signal. Second, the value of the guidelines may be unclear to investors. In either case, more public disclosure (i...

An examination of small motor carrier survival techniques

Purpose – The purpose of this paper is to compare small and large motor carriers to determine whether small motor carriers serve a smaller, more concentrated customer base, have owners that are more involved in the customer relationship management process, and earn higher returns usually associated with niche market players.Design/methodology/approach – Responses from a US sample of 153 motor carrier managers are subjected to ANOVA comparing small, medium, and large motor carriers. Scale development procedures were employed and a construct measuring owner involvement in the customer relationship management process was developed.Findings – Small motor carriers have a more concentrated customer base, their owners are more involved in managing customer relationships, and they are paid higher rates per mile compared with large motor carriers.Research limitations/implications – This research was limited by its focus on the motor carrier industry and did not explicitly test a link between customer base concentr...

Sainsbury's in Egypt

Subject area – International Strategy Study level/applicability – Undergraduate or graduate capstone course in strategy or international management course. Case overview – Faced with increased competition at home, Sainsbury’s decided to expand its international operations by entering Egypt. Sainsbury’s initially created a joint venture with an Egyptian food retailer, but quickly increased its commitment by opening over 100 stores in Egypt. Sainsbury’s dream of capturing the Egyptian food market faded as quickly as it was started. Due to declining profits, Sainsbury’s eliminated its exposure in Egypt by selling its interests to its Egyptian partner. Sainsbury’s first developing-country venture could be regarded as an object lesson in how not to operate. The company failed to properly investigate its market and its partners, and showed insensitivity to local conditions. Moreover, entering the Egyptian consumer business sector may have been ill-advised. Egypt, with a low gross domestic product (GDP) per head...

The Duty of Fair Dealing: Board Judgment in Management Led Buyouts

This paper investigates board judgment in response to management led buyouts (MLBs). Board response is suggested to be guided by the business judgment rule and its dual duties of care and loyalty. The duty of loyalty is seen to be evolving into a specification of fair dealing. With this trend, the current interpretation of the business judgment rule emphasizes the role of care and relies on the market to insure fairness. Possible failures in the MLB market which limit its effectiveness in assuring fairness are discussed. Recommendations to counteract these failures are suggested.