Exposing the 20th Century Corporation: Redesigning 21st Century Boards and Board Performance

Abstract

Governance oriented boards are prevalent across different economic systems (Hall and Soskice, 2001), cultures (Hofstede et al., 2010) and national boundaries (single/dual structure) in which they are the leading clique within private, not-for-profit, public and hybrid organisations (Hermalin and Weisbach, 2003). Their purpose goes beyond regulation (Aguilera and Jackson, 2003), ameliorating the agency problem (Fama and Jensen, 1983; Berle and Means, 2009/1932) or shareholder wealth maximisation (Friedman, 1962) to balancing society’s needs and wants in a virtuous and accountable manner (Aristotle, 384–322 BCE; Smith, 1759). However, the emerging wider impacts of the corporation suggest deep concerns about the performance and management of board-directed organisations with respect to market dominance (Kim, 2012), lobbying dynamics (Child et al., 2012), board remuneration (Gregory-Smith and Main, 2012), financial management (Berger et al., 2012), competitive behaviour (Porter, 2009) and political power struggle issues (Cutting and Kouzmin, 2002).