A cross-national study of corporate governance and employment contracts

Business Ethics 17 (3):259–284 (2008)
Abstract
Corporate governance (CG) can be seen to operate through a 'double agency' relationship: one between the shareholders and corporate management, and another between the corporate management and the firm's employees. The CG and labour management of firms are closely related. A particularly productive way to study how CG affects and is affected by the employment relationship has been to compare CG across countries. The contributions of this paper to that literature are threefold. (1) An integration of aspects of the labour management literature in the CG debate. (2) Based on a sample of about 1000 firms from 31 countries, we find evidence of complementarities between the CG and the labour management of firms. Extreme cases, in general, outperform mixed cases. (3) Firm differences within countries are more important than scholars have assumed so far. We present the results of the study and implications for future research and for practice.
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