A multiple network approach to corporate governance
- 316 Downloads
In this work, we consider corporate governance (CG) ties among companies from a multiple network perspective. Such a structure naturally arises from the close interrelation between the Shareholding network and the Board of Directors network. In order to capture the simultaneous effects of both networks on CG, we propose to model the CG multiple network structure via tensor analysis. In particular, we consider the TOPHITS model, based on the PARAFAC tensor decomposition, to show that tensor techniques can be successfully applied in this context. By providing some empirical results from the Italian financial market in the univariate case, we then show that a tensor–based multiple network approach can reveal important information.
KeywordsMultiple networks Tensor analysis Corporate governance
We would like to thank the anonymous referees for their valuable comments and suggestions which helped us to improve the manuscript.
- Bader, B.W., Kolda, T.G., et al.: MATLAB Tensor Toolbox Version 2.5. http://www.sandia.gov/ tgkolda/TensorToolbox/ (2012). Jan 2012
- Barrat, A., Barthélemy, M., Vespignani, A.: Dynamical Processes on Complex Networks, 4th edn. Cambridge University Press, Cambridge (2011)Google Scholar
- Bertoni, F., Randone, P.A.: The small-world of Italian finance: ownership interconnections and board interlocks amongst Italian listed companies. Working paper (2006)Google Scholar
- Bianchi, M., Bianco, M.: Italian corporate governance in the last 15 years: from pyramids to coalitions?. Finance working paper No 144. European corporate governance institute (2006)Google Scholar
- Menichetti, G., Remondini, D., Panzarasa, P., Mondragón, R. J., Bianconi, G., Weighted multiplex networks arXiv:1312.6720 (2013)
- D’Errico, M., Grassi, R., Stefani, S., Torriero, A.: Shareholding networks and centrality: an application to the Italian financial market. Lect. Notes Econ. Math. Syst. 613, 215–228 (2009)Google Scholar
- D’Errico, M., Stefani, S., Torriero, A. Informal ties in organizations: a case study. Qual. Quant. pp. 1–15 (2013). Article in Press. http://dx.doi.org/10.1007/s11135-013-9862-0
- Estrada, E.: The Structure of Complex Networks: Theory and Applications. Oxford University Press, Oxford (2012)Google Scholar
- Harary, F.: Graph Theory. Addison-Wesley, Reading (1969)Google Scholar
- Harshman, R.A.: Foundations of the PARAFAC procedure: models and conditions for an “explanatory” multimodal factor analysis. UCLA Working papers in phonetics 16, 1–84 (1970)Google Scholar
- Kolda, T.G., Bader, B.W., Kenny, J.P.: Higher-order web link analysis using multilinear algebra, SANDIA REPORT, SAND2005-4548 (2005)Google Scholar
- Piccardi, C., Calatroni, L., Bertoni, F., Communities in Italian corporate networks. Phys. A: Stat. Mech. Appl. 389(22), pp. 5247–5258 (2010). ISSN 0378–4371, http://dx.doi.org/10.1016/j.physa.2010.06.038
- Rotundo, G., D’Arcangelis, A.M.: Network of companies: an analysis of market concentration in the Italian stock market. Qual. Quant. 1–18 (in press, 2013).Google Scholar
- Santella, P., Drago, C., Polo, A., Gagliardi E.: A Comparison among the director networks in the main listed companies in France, Germany, Italy, and the United Kingdom. MPRA Paper No. 16397 (2009)Google Scholar
- Solà L., Romance M., Criado R., Flores J., Garcia Del Amo A., Boccaletti S.: Centrality of nodes in multiplex networks. arXiv:1305.7445v1 (2013).
- Tucker, L.R.: Implications of factor analysis of three-way matrices for measurement of change. In: Harris, C.W. (ed.) Problems in Measuring Change, pp. 122–137. University of Wisconsin Press, Madison (1963)Google Scholar