Affiliation:
1. Belarusian National Technical University
Abstract
Aim. The presented study aims to develop the theoretical foundations of corporate governance in transnational corporations (TNCs) in the context of specifying the economic content of this concept based on a critical analysis of existing approaches to its interpretation.Tasks. The authors systematize and critically analyze existing approaches to the interpretation of corporate governance of TNCs; clarify the definition of corporate governance based on the organizational and socio-economic peculiarities of modern TNCs.Methods. The methodological basis of this study includes subjective, historical, and civilizational approaches. The study uses the methods of analysis, grouping, and systematization. The materials used include works of well-known scientists and economists on the problem under consideration.Results. The authors critically analyze literary sources on the problem of identifying the economic essence of corporate governance of TNCs. Four major approaches to the interpretation of corporate governance reflecting the evolution of this phenomenon are identified and described: center-right approach (corporate governance is considered as a legalized voluntary agreement between the owners and the executive body in connection with the management of the corporation’s economic activities); managerial approach (corporate governance serves to resolve the conflict of interests between shareholders acting as real owners and professional managers who actually manage the corporation); shareholder-centered aprroach (corporate governance is considered from the perspective of shareholders’ interests and the growth of stock prices in the stock market is used as the main criterion of TNC performance; socially oriented approach (emerged in response to the growing rejection of social inequality by the population and employees as a result of the TNCs’ focus on maximizing profit, environmental problems, strengthening of ideological and political opponents of the neoliberal economy; this approach comprises many concepts, such as the concept of corporate social responsibility, corporate social capital, knowledge network theory, and the concept of the company participation). As the theory and practice of corporate governance developed, the emphasis in its interpretation shifted from owners to managers, from managers to shareholders and, finally, from shareholders to a wide range of interested parties (the state, the local community, employees, contractors).Conclusions. Based on the analysis of viewpoints and the study of the distinctive characteristics of modern corporate governance, the following refined definition is proposed: corporate governance of TNCs is the organizational and economic relations between professional top managers, capital owners, labor collectives, public administration bodies, and other stakeholders in the context of the implementation of the corporation’s strategic goals by ensuring the effeciency of the mechanism for making effective decisions and monitoring the results.
Publisher
Saint-Petersburg University of Management Technologies and Economics - UMTE