The top management team (TMT) is of vital importance to the success and survival of a company. This holds particularly for newly founded high-tech start-ups. While the overall importance of the TMT is well established in research on corporate governance and management, less is known about the structural organization of the TMT. In order to fill this research gap, the chapter develops and explains basic arrangements with regard to the vertical differentiation among the members of the TMT and evaluates their strengths and weaknesses based on a group theoretical framework. More specifically, it distinguishes command models of TMT organization and collegial ones, and demonstrates their potential impact on behavioral, cognitive and affective TMT processes which transform TMT inputs into various TMT outcomes.
Edited by Jonas Gabrielsson
Asma Fattoum-Guedri and Frédéric Delmar
This chapter investigates the use of defensive mechanisms disconnecting cash flow rights from voting rights at initial public offering (IPO) by controlling shareholders. It specifically examines whether founder-chief executive officers (CEOs) are more inclined than non-founder-CEOs to implement defensive mechanisms at IPO. Building on intrinsic and extrinsic attributes distinguishing founder-CEOs from other types of CEOs, this study suggests that founder-CEOs, who are generally controlling shareholders of the company at IPO, are likely to be more anxious about a post-IPO change of control relative to non-founder-CEOs. This in turn makes them more inclined to use defensive mechanisms at IPO. Empirical support for these arguments is provided using a unique hand-collected dataset of all 467 IPOs completed in the French capital markets from 1992 to 2010.
Stefano Bonini and Vincenzo Capizzi
Susanne Durst and Julia Brunold
The study of corporate governance is dominated by quantitative research and tends to focus on large listed companies. As a response to this situation, this chapter examines how corporate governance is practiced in smaller businesses. It reports findings based on semi-structured interviews conducted with executive staff of smaller privately held firms from the Rhine Valley region. More precisely, parts of both Austria (Province of Vorarlberg) and the Principality of Liechtenstein were covered. In total, 25 individuals were involved. The findings particularly emphasize the concept of relational governance as a more appropriate governance approach in small firms. Thereby the chapter suggests that the relational governance approach needs to be extended by also considering employees and their contribution to governance practices and company development. The chapter’s findings may help managing directors of smaller firms to better understand and exploit the benefits of different governance mechanisms in their efforts to cope with different business challenges ahead. The findings may also be used by policy-makers to help them develop improved corporate governance codes and best practice recommendations. To sum up, the chapter provides fresh insights into the practice of governance in smaller firms from a practitioner’s perspective. Additionally, it offers the opportunity of expanding understanding of the topic in different parts of the world.