Manuscript Type: Conceptual Research Question/Issue: We research two questions: First, why do some institutional investors operate at a distance from organizations seemingly acting only to "exit" and "trade" shares, while others actively engage through various means of "voice"? Second, what processes and behaviour are associated with active ownership? Research Findings/Insights: We develop the concept of active ownership by drawing on contrasting theories and images of ownership, identifying antecedents of active ownership and distinguishing between alternative processes of active ownership. Theoretical/Academic Implications: Alternative pathways to active ownership contrast the distant, sometimes adversarial nature of shareholder activism with an engaged, collaborative relationship between investors and corporations. Few studies examine active ownership as a process of engagement and mutual exchange between parties taking a generally longer-term perspective toward investment in the firm and its affairs. After modeling active ownership, we develop a research agenda of substantive issues ranging from market and institutional conditions, through investment organization and practice, to board and investor relations. Practitioner/Policy Implications: Opening up the multidimensionality of engagement and relations between investors and corporations is crucial to promoting good corporate governance. Policymakers and practitioners require such knowledge when anticipating and developing adjustments to institutions of corporate governance.
Purpose-This paper examines how board evaluations have emerged as an important tool in public policy and corporate practice for enhancing board effectiveness. Design/methodology/approach-We review the extensive literature on effectiveness and the emerging literature on board evaluation to identify ways to assess the current policy direction for external evaluation of corporate boards. Findings-The paper develops an integrated framework of effectiveness that can be used as a tool for board evaluation, in particular for externally facilitated exercises. Research limitations/implications-Through its integration of prior conceptual work this paper advances our theoretical understanding of this emerging part of policy and practice, with to-date lack much empirical basis. Practical implications-The framework we develop shows ways to focus how the practice is conducted by boards and external evaluators alike. Social implications-It can also help policy formation by pointing out the limitations as well as benefits of various policy options. Originality/value-In pointing to ways to develop study of the field through empirical research it provides direction for future academic research. It also identifies a need for and direction toward the professionalization of practice.
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