Organisatie van het bestuur van de onderneming
Dagdeel 3Vrijdag 9 mei 2008
2:00 – 5:30 pm
Docent: Dr. M.P. Goede
Agenda
• Tijd Inhoud• 2:00 – 2:30 The Corporation (DVD)• 2:30 – 3:00 De historical and theoritical
context• 3:00 – 3:30 In side the corporation• 3:30 – 4:00 Power around
organizations• 4:00 – 4:30 Governance Curacao• 4:30 – 5:30 The cultural context
(Adam Smith, 1776)
• The directors of such [joint-stock] companies, however, being the managers rather of other people’s money than of their own, it cannot well be expected, that they should watch over it with the same anxious vigilance with which the partners in a private copartnery frequently watch over their own.... Negligence and profusion, therefore, must always prevail, more or less, in the management of the affairs of such a company.
• The Corporation (Joel Bakan,2004)
• Chapters– The corporation’s rise to dominance– Business as usual– The externalizing machine– Democracy– Corporation unlimited– Reckoning
The corporation’s rise to dominance
• Vermeer, J. (2006), Corporate Governance; Theory, History and Practice– Adam Smith 1776– Introduction
• CG his not new
– Theoretical concepts• Agency Theory or Principle Agent Theory• Models of CG
Principle Agent Theory
• Ross (1973)• Jensen (1976)
– Conflict between management and owner
• Owner is shareholders• Has only residual claim
Two models of CG
• Anglo-American/ Financial Market Model– Ownership widely spread– Share prices rule
• Stakeholders Model– Big shareholders rule
History
• 1602 – 1799 VOC– Board of Seventeen Lord– Shareholders were neglected– 1622
• Committee of Nine to advise the Board• Audit Committee
• Mississippi Company -1720
• British South Sea Company
• Early industrialization– Entrepreneurial capitalism
• Late industrialization– Managerial capitalism
• Information age– Institutional capitalism
Conclusions
• CG is not new
• Managers– Need to direct– Need to be controlled– Are accountable
• Bad Governance is not the consequence of poor structures but of GREED
Organizing
• Division of task and coordination
• This is a different question then: What is an organization
Five basic parts
• Strategic apex: in charge and make sure the organization serves mission and those who have power
• Middle management: joins the apex and the operating core
• Operating core: basic work related directly to the production
• Support Staff: serve to effect standardization• Technostructure: provides support to the parts
outside the operating workflow
The organization as a system of flows
• Formal authority• Regulated flows
– Operating work flow– Regulated control flows– Regulated information flows
• Informal communication• Work constellations• Ad hoc decisions process
The effective structuring
• A close fit between contingency factors and design parameters
• A internal consistency among design parameters
• Consistency among design parameters and contingency factors
Age & Size
• The older the organization the more formalized its behavior
• Structure reflect the age of founding of the industry• The larger the organization the more elaborated its
structure, that is, the more specialized its task, the more differentiated its units, and the more developed its administrative components
• The larger the organization, the larger the size of its units• The larger the organization the more formalized its
behavior
Stages of structural development
• As organizations grow, they go through structural transitions, changes in kind rather than degree.– Craft
• Entrepreneurial
– Bureaucratic– Divisionalized– Matrix
Technical system
• The more regulating the technical system, the more formalized the operating work and the more bureaucratic the structure of the operating core
• The more sophisticated the technical system, the more elaborate the administrative structure, specially the larger and more professional the support staff, the greater the the selective decentralization (to that staff), and the greater the use of liaison devices (to coordinate the work of the staff)
Environment
• The more dynamic the environment, the more organic the structure
• The more complex the environment, the more decentralized the structure
• Extreme hostility in its environment drives any organization to centralize its structure temporarily
• Disparities in the environment encourage the organization to decentralize selectively
Power
• The greater the external control of the organization, the more centralized and formalized its structure
• The power needs of the members tend to generate structures that are excessively centralized
• Fashion favors the structure of the day (and of the culture), sometimes even when inappropriate
Machine bureaucracy
• Standardization of work processes
• Technostructure
• Limited horizontal decentralization
Professional bureaucracy
• Standardization of skills
• Operating core
• Vertical and horizontal decentralization
Concluding pentagon
• The five pulls
• The five pure types
• The basis for describing hybrids
• For describing transitions
• The organization is driven towards one of the configurations in a search for harmony in its structure.
• Some hybrids are dysfunctional others are logical.
• Transitions– Simple to machine– Adhocracy to machine bureaucracy
Colley, (2003), Corporate Governance
• Incorporation/ charter– Corporate Name– Purpose– Registered Office or Agent– Authorized Capital Stock– Bylaws
Bylaws
• The number of directors on the board• The number of insiders and outsiders• The length of terms• The various board committees and their charges• Details about the annual meeting of shareholders• The conditions under which the proxy statements will be
issued to share holders• How directors will vote and how the votes will be counted• The election and duties of corporate and board officers
Major Considerations Relative to the Bylaws
• How much flexibility should be given to shareholders to call special meetings and to present proposals for voting?
Board Committees
• Committee of outside directors
• Executive Committee
• Compensation Committee
• Audit Committee
• Nominating and Governance Committee
• Other Standing Committees
• Special Committees
• Mintzberg, H. (1987*), Power in and around organizations– The origins of the attack on the corporation
• Economic power has become highly concentrated• This has social consequences• Expectations on economic and social behavior has
changed• Corporations are controlled by their administrators
and there is no legitimate base for this
The dimensions
• Goals favored– Social goals – Economic goals
• Disciplinary perspective– Sociological – Managerial – Economics
• Interpersonal relations– Conflict – Harmony
• External means of influence• Control of the corporation• Power configuration
– Instrument – Political Arena – Closed system
• Political stance– Radical – Liberal – Skeptic – Conservative - Reactionary
– The positions• Nationalize it• Democratize it• Regulate it• Pressure it• Trust it• Ignore it• Induce it• Restore it
– Nationalize it• Instrument in hands of the government
– Democratize it• External representation• Internal participation
– Regulate it• More formal constrains by government
– Pressure it• By special interest groups
– Trust it– Ignore it– Induce it– Restore it
The bullets of Dick (2002)
• Overheid stelt geen doel en geen criteria
• Overheid heeft ook sociale doelstellingen en moet bevriend blijven met iedereen
• Overheid geeft geen aansturing
• Overheid bemoeit zich wel met de verkeerde dingen
• Er is geen leiderschap en geen gedegen controle
• RvC krijgt geen aanwijzingen van aandeelhouder
• Directeur bepaalt zelf het beleid en het beheer van NV
• Bepaalde NV’s hebben een slecht beleid, investeren miljoenen in projecten waar geen positieve resultaten uitkomen. Genoemd werd UTS met dochtermaatschappijen. Aqualectra met inefficiente investeren uit het verleden en DOK waar de overheid de garanties betaald
• Er wordt niet afgerekend – geen accountablity
• Gevolgen: inefficienty, niet transparant• Meerdendeel van het publiek heeft
onvoldoende informatie en kennis en kan daardoor moeilijk of niet beoordelen
• Te vaak emotionele discussies waardoor niemand een goed overwogen beslissing neemt
• Vakbonden richten zich op korte termijn doelstellingen zoals arbeidsplaatsen en ziet de visie meerdere jaren over het hoofd
• Overheid moet overgaan tot privatisering maar er moeten bepaalde voorwaaden aan verbonden zijn
• Privatisering wordt vaak te eng bekeken. Privatiseren betekent niet zomaar verkopen. Privatiseren is o.a. een partnership zoeken voor nieuwe marktuitbreiding middels kapitaal- en knowledge injectie en die een toegevoegde waarde heeft voor de efficiency van de NV’s met het gevolg dat de gemeenschap kwaliteit krijgt van het aangeleverde product
The development of Curacao
• Pre colonial• Colonial
– Slavery
• Industrial– Shell
• Post colonial– Tourism– Off shore
• New economy