Corporate Form, Institutional Complementarity, and Organizational Behavior: Open versus Closed Joint-Stock Companies in Russia

  • Ichiro IwasakiEmail author
Part of the CSR, Sustainability, Ethics & Governance book series (CSEG)


The vast majority of Russian corporations are still compelled to become closed joint-stock companies that lack a modern fundraising mechanism in order to attract capital from a wide range of private investors. This is due to factors such as significant insider ownership, a strong orientation among managers toward closed organizations, slumping needs for corporate finance, and underdeveloped local financial institutions. The impact of ownership structure on the choice of corporate form exists, even if we assume that the two elements are determined endogenously. Under these circumstances, however, a significant number of closed companies attempt to develop more open internal organizational structures that are virtually the same as those of open companies. Nonetheless, an institutional coupling of a closed corporate form and an open internal organizational structure is far from effective in resolving the serious in-house problems facing Russian firms, such as the prevention of infighting among executives and shareholders and the implementation of discipline among top management.


Corporate Governance Firm Performance Ownership Structure Business Group Open Company 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.



This chapter presents research outcome from a Japan-Russia joint research project titled “Corporate Governance and Integration Processes in the Russian Economy” launched by the Institute of Economic Research, Hitotsubashi University, and the Institute for Industrial and Market Studies, National Research University – Higher School of Economics. It is a substantially revised and extended version of Iwasaki (2007b, 2009). This research was financially supported by a grant-in-aid for scientific research from the Ministry of Education and Sciences in Japan (No. 23243032), the Joint Usage and Research Center of the Institute of Economic Research, Hitotsubashi University, and the Japan Securities Scholarship Foundation (JSSF). I also thank Naohito Abe, Sabri Boubaker (book coeditor), Tatiana G. Dolgopyatova, Martin Gilman, Satoshi Mizobata, Duc K. Nguyen (book coeditor), and Andrei Yakovlev for their valuable comments and suggestions, and Dawn Brandon and Jim Treadway for their careful editorial assistance. Needless to say, all remaining errors are mine.


  1. Abe, N., & Iwasaki, I. (2010). Organisational culture and corporate governance in Russia: A study of managerial turnover. Post-Communist Economies, 22(4), 449–470.CrossRefGoogle Scholar
  2. Aoki, M. (2000). Information, corporate governance, and institutional diversity: Competitiveness in Japan, the USA, and the transitional economies. New York: Oxford University Press.Google Scholar
  3. Aoki, M. (2001). Toward a comparative institutional analysis. Cambridge/London: MIT Press.Google Scholar
  4. Central Bank of the Russian Federation. (2005). Biulleteni bankovskoi statistiki: regional'noe prilozhenie (Bulletin of banking statistics: Regional features), 1(17). (in Russian).Google Scholar
  5. Coase, R. H. (1937). The nature of the firm. Economica, 4(4), 386–405.CrossRefGoogle Scholar
  6. Dolgopyatova, T., Iwasaki, I., & Yakovlev, A. (Eds.). (2009). Organization and development of Russian business: A firm-level analysis. Basingstoke: Palgrave Macmillan.Google Scholar
  7. Eggertsson, T. (2005). Imperfect institutions: Possibilities and limits of reform. Ann Arbor: University of Michigan Press.Google Scholar
  8. Federal State Statistical Service. (2004). Struktura i osnovhye pokazateli deyatel'nosti predpriyatii (bes subientov malogo predprinimatelistva) za 2003 god po dannym strukturnogo obsledovaniya [Structure and basic indicators of enterprise activities (excluding small firms) in 2003 based on the structural survey]. Moscow: Federal State Statistical Service (in Russian).Google Scholar
  9. Federal State Statistical Service. (2005). Rossiiskii statisticheskii ezhegodnik 2004 [Russian statistical yearbook 2004]. Moscow: Federal State Statistical Service (in Russian).Google Scholar
  10. Iwasaki, I. (2007a). Corporate law and governance system in Russia. In B. Dallago & I. Iwasaki (Eds.), Corporate restructuring and governance in transition economies (pp. 213–249). Basingstoke: Palgrave Macmillan.Google Scholar
  11. Iwasaki, I. (2007b). Legal forms of joint stock companies and corporate behavior in Russia. Problems of Economic Transition, 50(5), 73–86.CrossRefGoogle Scholar
  12. Iwasaki, I. (2007c). Enterprise reform and corporate governance in Russia: A quantitative survey. Journal of Economic Surveys, 21(5), 849–902.CrossRefGoogle Scholar
  13. Iwasaki, I. (2008). The determinants of board composition in a transforming economy: Evidence from Russia. Journal of Corporate Finance, 14(5), 532–549.CrossRefGoogle Scholar
  14. Iwasaki, I. (2009). Legal form of incorporation. In T. Dolgopyatova, I. Iwasaki, & A. Yakovlev (Eds.), Organization and development of Russian business: A firm-level analysis (pp. 62–88). Basingstoke: Palgrave Macmillan.Google Scholar
  15. Iwasaki, I. (2011). Economic transition, firm organisation and internal control: determinants of audit structure in Russian firms. EBRD Working Paper No. 126. London: European Bank for Reconstruction and Development.Google Scholar
  16. Iwasaki, I. (2013a). Firm-level determinants of board system choice: Evidence from Russia. Comparative Economic Studies, 55(4), 636–671.Google Scholar
  17. Iwasaki, I. (2013b). Global financial crisis, corporate governance, and firm survival: The case of Russia. Journal of Comparative Economics. (Advance online publication, 28 Mar 2013)
  18. Iwasaki, I., & Suzuki, T. (2007). Transition strategy, corporate exploitation, and state capture: An empirical analysis of the former Soviet states. Communist and Post-communist Studies, 40(4), 393–422.CrossRefGoogle Scholar
  19. Karpoff, J. M., & Rice, E. M. (1989). Organizational form, share transferability, and firm performance: Evidence from the ANCSA corporations. Journal of Financial Economics, 24(1), 69–105.CrossRefGoogle Scholar
  20. Osipenko, O. (2005). Kosenke obnarodovannoi kontseptsii reformirovaniya federalinykh institutov korporativnogo upravleniya (An assessment of the published concept on the reform of the federal institutions of corporate governance). Rossiiskii Ekonomicheskii Zhurnal, (1), 34–44. (in Russian)Google Scholar
  21. Ostrom, E. (2005). Understanding institutional diversity. Princeton/Oxford: Princeton University Press.Google Scholar
  22. Young, H. P. (1998). Individual strategy and social structure: An evolutionary theory of institutions. Princeton/Oxford: Princeton University Press.Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2014

Authors and Affiliations

  1. 1.Institute of Economic ResearchHitotsubashi UniversityTokyoJapan

Personalised recommendations