Governance and enterprise restructuring: the case of Macedonia

Abstract

Purpose – This paper is a case study of the Republic of Macedonia and focuses on the development of governance and enterprise restructuring. Thus, country's effective corporate governance and corporate control, which impact enterprise restructuring, are essential in the analysis of market-driven restructuring through domestic financial institutions and markets. The data used in this article are analyzed with an econometric regression model, which as employed in this study examines the interrelationships between governance and enterprise restructuring and set of policies that influence the governance patterns. Two basic hypothesis are taken in the analysis: first, governance and enterprise restructuring depend on set of policies, such as, large-scale privatization, small-scale privatization, price liberalization, competition policy, trade and foreign exchange system, banking reform and interest rate liberalization, securities markets and non-bank financial institutions and overall infrastructure reform; and second, governance and enterprise restructuring improves over time due to imposed policies. The paper aims to discuss these issues. Design/methodology/approach – The data used in this article are analyzed with an econometric regression model, which as employed in this study examines the interrelationships between governance and enterprise restructuring and set of policies that influence the governance patterns. Findings – There is still more to be done in order to bring these economies closer to the standards of developed ones. Indeed, it is needed considerable improvement of corporate governance, institution-building to control agency problems and imposing already adopted regulation, as well as, enforcing new enterprise restructuring policies, within existing policies of overall transition economy restructuring. Originality/value – This paper is a contribution to the research developing the business aspects of the Macedonian economy, as there is constant lack of scientific papers that deal with the specific issues of corporate governance and enterprise restructuring.