Corporate Decline and Corporate Governance

2016 Fiscal Year Final Research Report

• Project/Area Number: 25380460
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Research Field: Management
• Research Institution: Yokohama National University
• Principal Investigator: Yoshimori Masaru 横浜国立大学, 大学院国際社会科学研究院, 名誉教授 (20182834)
• Project Period (FY): 2013-04-01 – 2017-03-31
• Keywords: Corporate governance / Charisma manager / Power concentration / Succession planning / Board Chairman / CEO / Diversification / Family company

Outline of Final Research Achievements

The research concluds that exessive power concentration of the carisma Board Chairman or the CEO leads to dysfunction of the corporate governance, which may leads to corporate decline or failure. This finding is based on the German cases including Volkswagen and was published as a book titled Big Family Firms of Germany in 2015. Second conclusion is that the term of office and the reelction procedures should be clearly documented. Thirdly the Boaard should evaluate their contribution to the firm before they are reelected. Fourthly minimum one third of the Boaard should be outside directors with absolute independence. Lastly the ouside directors should maintain contact with major middle managers to identify any important problems.

Free Research Field

Comparative Business Management