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Corporate Governance Processes (corporate + governance_process)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting100%

Selected Abstracts

Evaluating the Characteristics of Corporate Boards Associated with Layoff Decisions

CORPORATE GOVERNANCE, Issue 2 2006
Alfred Yawson
The paper evaluates the characteristics of corporate boards associated with layoff decisions using a large sample of UK firms suffering performance declines over the period 1994,2003. The results show that firms are less likely to respond to performance declines with employee layoffs when they have large boards. Further analysis shows that layoff decisions are positively associated with the proportion of outside directors and directors' remuneration. The findings provide some support to the recommendations of the Cadbury Report (1992) and Higgs Review (2003) on the importance of the structure and composition of board of directors in the corporate governance process. [source]

An exploratory study of governance in the intra-firm human resources supply chain

HUMAN RESOURCE MANAGEMENT, Issue 5 2010
Elaine Farndale
Abstract The human resource management (HRM) literature has paid insufficient attention to supply chain management (SCM) when exploring the architecture of human resources (HR). Drawing on an SCM perspective, this study develops our understanding of (1) the intra-firm HR supply chain, and (2) how this HR supply chain influences corporate governance processes within large organizations. We argue that the HR function, represented as an internal professional service supply chain, needs appropriate governance principles as it operates through multiple delivery channels and with a wide variety of HRM practices. Exploratory findings from a qualitative empirical study of seven large organizations investigating governance and risk management in the HR supply chain are presented. These in-depth interviews uncover how formal governance is relatively easy for these organizations to achieve, supported by outcome-focused monitoring tools, but informal governance mechanisms can fail due to insufficient attention. Although standardized approaches to HR delivery can maximize the opportunity for HR governance, little evidence was found that the organizations were considering the related governance implications explicitly. © 2010 Wiley Periodicals, Inc. [source]

Pay Without Performance: Overview of the Issues

JOURNAL OF APPLIED CORPORATE FINANCE, Issue 4 2005
Lucian A. Bebchuk
In their recent book, Pay Without Performance: The Unfulfilled Promise of Executive Compensation, the authors of this article provided a comprehensive critique of U.S. executive pay practices and the corporate governance processes that produce them, and then offered a number of proposals for improving both pay and governance. This article presents an overview of their analysis and proposals. The authors' analysis suggests that the pay-setting process in U.S. public companies has strayed far from the economist's model of "arm's-length contracting" between executives and boards in a competitive labor market. In place of this conventional model, which is standard in corporate law as well as economics, the authors argue that managerial power and influence play a major role in shaping executive pay, and in ways that end up imposing significant costs on investors and the economy. The main concern is not the levels of executive pay, but rather the distortion of incentives caused by compensation practices that fail to tie pay to performance and to limit executives' ability to sell their shares. Also troubling are "the correlation between power and pay, the systematic use of compensation practices that obscure the amount and performance insensitivity of pay, and the showering of gratuitous benefits on departing executives." To address these problems, the authors propose three kinds of changes: 1)increases in transparency, accomplished in part by new SEC rules requiring annual corporate disclosure that provides "the dollar value of all forms of compensation" (including "stealth compensation" in the form of pensions and other post-retirement benefits) and an analysis of the relationship between the past year's pay and performance, as well as more timely and informative disclosure of insider stock purchases and sales; 2)improvements in pay practices, including greater use of "indexed" stock and options to limit "windfalls," tougher limits on executives' freedom to sell shares, and greater use of "clawback" provisions in bonus plans that would force executives to return pay for performance that proves to be temporary; and 3)improvements in board accountability to shareholders, including limits on the use of staggered boards and granting shareholders the right to nominate directors and propose changes to governance arrangements in the corporate charter. [source]

Frequency of Man-Made Disasters in the 20th Century

JOURNAL OF CONTINGENCIES AND CRISIS MANAGEMENT, Issue 1 2006
Les Coleman
This paper analyses two disaster databases maintained by the Center for Research on the Epidemiology of Disasters and by Emergency Management Australia. The objective is to quantify the frequency, nature and changes in man-made disasters in industrialised countries during the past century. The analysis shows an exponential growth in disaster frequency, largely due to an increase in traditional hazards such as fires and explosions, rather than from new technologies. Although the number of incidents has grown, this has been offset by a decline in fatalities per incident. An important implication of these results is that regulatory oversight and internal corporate governance processes are inadequate to ensure effective management of modern industrial risks. [source]