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Corporate governance and management practices: stakeholder involvement, quality and sustainability tools adoption

Evidences in local public utilities

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Abstract

Local public services are the field in which New Public Management (NPM) and Public Governance 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 a separation has taken place 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 to 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, by extending 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 to 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.

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Notes

  1. The Guidelines are primarily oriented to SOEs using a distinct legal form and having or not commercial activity, whether or not they pursue a public policy objective as well. The term SOEs “refers to enterprises where the state has significant control, through full, majority, or significant minority ownership. However, many of the Guidelines are also useful in cases where the state retains a relatively small stake in a company, but should nevertheless act as a responsible and informed shareholder. In the same vein, the term “ownership entity” refers to the state entity responsible for executing the ownership rights of the state, whether it is a specific Department within a Ministry, an autonomous agency or other” (OECD 2005, pp. 10–11).

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Authors and Affiliations

  1. University of Rome Tor Vergata, Via Columbia, 2, 00133, Roma, Italy

    Luca Gnan, Alessandro Hinna, Fabio Monteduro & Danila Scarozza

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  1. Luca Gnan
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  2. Alessandro Hinna
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  3. Fabio Monteduro
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  4. Danila Scarozza
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Correspondence to Luca Gnan.

Appendix

Appendix

See Table 4.

Table 4 Descriptive statistics and bivariate correlations (Pearson correlation)
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Gnan, L., Hinna, A., Monteduro, F. et al. Corporate governance and management practices: stakeholder involvement, quality and sustainability tools adoption. J Manag Gov 17, 907–937 (2013). https://doi.org/10.1007/s10997-011-9201-6

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