Corporate Governance Systems Diversity: A Coasian Perspective on Stakeholder Rights
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We examine corporate governance diversity within a Coasian framework of stakeholder rights, where the central role of governance is to ensure that necessary firm-specific investments are made. This Coasian perspective on stakeholder theory offers a unifying framework towards a global theory of comparative corporate governance, bridging the gap between economic theories of the firm and stakeholder theory, also offering an economics-based alternative to agency theory that explicitly accounts for stakeholder rights. The Coasian perspective encompasses a diversity of corporate governance systems, but does not imply a unique global corporate governance benchmark. We posit that governance is firm dependent and endogenous conditional on the constraints imposed by a national governance system; consequently, there should be no systematic relationship between governance and firm performance once the national constraints are controlled for. However, the same national corporate governance system constraints confer comparative advantages to firms whose efficient levels of firm-specific investments are favored.
KeywordsTheory of the firm Stakeholder rights Firm-specific investments Corporate governance systems Comparative advantage
National governance system constraints
We thank Vic Anand, Francesco Bova, Peter Jaskiewicz, David Pyke, Emilson Silva, and participants at the European International Business Academy meeting 2012 and the Academy of International Business meeting 2014 for their comments and feedback. We thank the Social Sciences Research Council of Canada for financial support.
This study was funded by an insight grant from the Social Sciences and Humanities Research Council of Canada.
Compliance with ethical standards
Conflict of interest
The authors declare that they have no conflict of interest.
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