The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance

In recent years there has been considerable discussion of and some movement towards harmonisation of governance structures and processes between EU and North America in particular. Multilateral organisations such as the World Bank together with the expansion of the EU in 2004 have provided added imp...

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Main Authors: Bickley, Maureen, Nowak, Margaret
Format: Book Chapter
Published: Elsevier 2005
Subjects:
Online Access:http://hdl.handle.net/20.500.11937/43246
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author Bickley, Maureen
Nowak, Margaret
author_facet Bickley, Maureen
Nowak, Margaret
author_sort Bickley, Maureen
building Curtin Institutional Repository
collection Online Access
description In recent years there has been considerable discussion of and some movement towards harmonisation of governance structures and processes between EU and North America in particular. Multilateral organisations such as the World Bank together with the expansion of the EU in 2004 have provided added impetus for a broader focus on harmonisation. At the same time, emanating from the USA, the requirement to confirm to Sarbanes Oxley has exerted unilateral pressure on individual corporations worldwide. The authors argue, however, that a "one size fits all" approach to governance is not consistent with the different cultural values, frameworks and legal systems which are the various national contexts of governance. These differences are consistent with alternate paradigms concerning the motivation and behaviours of directors. It is further argued that these differences are relevant to discussion of corporate sustainability. The authors note that the theoretical models, agency theory and stewardship theory, are each consistent with alternative accountability approaches and thus different approaches to director motivation. A qualitative study of Austrian company directors is used to investigate whether the recent development of a more open economy coupled with the global capital market is generating a convergent model of director conduct. It was apparent that a stakeholder approach, where stewardship theory best explains the processes to mediate director conduct, continues to best describe the Austrian way. This contrasts with "theory in use" in Anglo/US practice which conforms to the tenets of Agency theory. We conclude with a discussion of the implications for sustainability management.
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spelling curtin-20.500.11937-432462017-02-27T15:15:12Z The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance Bickley, Maureen Nowak, Margaret corporate social responsibility agency theory stewardship theory stakeholders director conduct comparative governance In recent years there has been considerable discussion of and some movement towards harmonisation of governance structures and processes between EU and North America in particular. Multilateral organisations such as the World Bank together with the expansion of the EU in 2004 have provided added impetus for a broader focus on harmonisation. At the same time, emanating from the USA, the requirement to confirm to Sarbanes Oxley has exerted unilateral pressure on individual corporations worldwide. The authors argue, however, that a "one size fits all" approach to governance is not consistent with the different cultural values, frameworks and legal systems which are the various national contexts of governance. These differences are consistent with alternate paradigms concerning the motivation and behaviours of directors. It is further argued that these differences are relevant to discussion of corporate sustainability. The authors note that the theoretical models, agency theory and stewardship theory, are each consistent with alternative accountability approaches and thus different approaches to director motivation. A qualitative study of Austrian company directors is used to investigate whether the recent development of a more open economy coupled with the global capital market is generating a convergent model of director conduct. It was apparent that a stakeholder approach, where stewardship theory best explains the processes to mediate director conduct, continues to best describe the Austrian way. This contrasts with "theory in use" in Anglo/US practice which conforms to the tenets of Agency theory. We conclude with a discussion of the implications for sustainability management. 2005 Book Chapter http://hdl.handle.net/20.500.11937/43246 Elsevier restricted
spellingShingle corporate social responsibility
agency theory
stewardship theory
stakeholders
director conduct
comparative governance
Bickley, Maureen
Nowak, Margaret
The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance
title The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance
title_full The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance
title_fullStr The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance
title_full_unstemmed The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance
title_short The Austrian way: Director conduct in the context of legal and cultural frameworks of corporate governance
title_sort austrian way: director conduct in the context of legal and cultural frameworks of corporate governance
topic corporate social responsibility
agency theory
stewardship theory
stakeholders
director conduct
comparative governance
url http://hdl.handle.net/20.500.11937/43246