Relational dimensions of corporate governance in translation: networked governance in China and India

The effectiveness of corporate governance mechanisms has been a subject of academic research for many decades. Although the large majority of corporate governance studies prior to mid 1990s were based on data from developed market economies such as the U.S., U.K. and Japan, in recent years researchers have begun examining corporate governance in transition economies. A comparison of China and India offers a unique environment for analyzing the effectiveness of corporate governance. First, both countries state-owned enterprise (SOE) reform strategies hinges on the Modern Enterprise System characterized by the separation of ownership and control. Ownership of an SOE’s assets is distributed among the government, institutional investors, managers, employees, and private investors. Effective control rights are assigned to management, which generally has a very small, or even nonexistent ownership stake. This distinctive shareholding structure creates conflict of interest not only between management (insiders) and outside investors but also between large shareholders and minority investors. Moreover, because both governments desire to retain some control—in part through partial retained ownership of commercialized SOEs, further conflicts arise between politicians and firms. Second, directors in publicly listed firms in both countries are predominantly drawn from institutions with significant non-market objectives: the government and other state enterprises, particularly in China, and extended families, particularly in India. As a result, the effectiveness of internal governance mechanisms, such as the number of independent directors on the board and the number of independent supervisors on the supervisory committee, are likely to be quiet limited, although this has yet to be fully evaluated. Third, because of the political nature of the privatization process itself, typical external governance mechanisms, such as debt (in conjunction with appropriate bankruptcy procedures), takeover threats, legal protection of investors, product market competition, etc., have not been effective. Bank loans have traditionally been viewed as grants from the state designed to bail out failing firms. State-owned banks retain monopoly or quasi-monopoly positions in the banking sector and profit is not their overriding objective. If political favor is deemed appropriate, subsidized loans, rescheduling of overdue debt or even outright transfer of funds can be arranged with SOEs (soft budget constraints). In addition, a market for private, non-bank debt is limited in India and has yet to be established China. There is no active merger or takeover activity in Chinese stock markets to discipline management. Information available in the capital markets is insufficient to keep at arm’s length of the corporate decisions. In light of the above peculiarities, China and India share many of the typical institutional characteristics as a transition economy, including poor legal protection of creditors and investors, the absence of an effective takeover market, an underdeveloped capital market, a relative inefficient banking system and significant interference of politicians in firm management. Su (2005) finds that the extent of political interference, managerial entrenchment and institutional control can help explain corporate dividend policies and post-IPO financing choices in this situation. Allen et al. (2005) demonstrate that standard corporate governance mechanisms are weak and ineffective for publicly listed firms while alternative governance mechanisms based on reputation and relationship have been remarkably effective in the private sector. Because the peculiarities are significant in this context, the differences in the political-economies of the two countries are likely to be evident in such relational terms. In this paper we explore the peculiarities of corporate governance in this transitional environment through a systematic examination of certain aspects of these reputational and relationship dimensions. Utilising the methods of social network analysis we identify the inter-organisational relationships at board level formed by equity holdings and by shared directors. Using data drawn from the Orbis database we map these relations among the 3700 largest firms in India and China respectively and identify the roles played in these relational networks by the particularly characteristic institutions in each case. We find greatly different social network structures in each case with some support in these relational dimensions for their distinctive features of governance. Further, the social network metrics allow us to considerably refine proxies for political interference, managerial entrenchment and institutional control used in earlier econometric analysis.

Distributed digital post-production

It is now possible to use powerful general purpose computer architectures to support post-production of both video and multimedia projects. By devising a suitable portable software architecture and using high-speed networking in an appropriate manner, a system has been constructed where editors are no longer tied to a specific location. New types of production, such as multi-threaded interactive video, are supported. Editors may also work remotely where very high speed network connection is not currently provided. An object-oriented database is used for the comprehensive cataloging of material and to support automatic audio/video object migration and replication. Copyright © 1997 by the Society of Motion Picture and Television Engineers, Inc.

A computational study of the characteristics of aircraft post-crash fires

Full-scale furnished cabin fires have been studied experimentally for the purpose of characterising the post-crash cabin fire environment by the US Federal Aviation Administration for many years. In this paper the Computational Fluid Dynamics fire field model SMARTFIRE is used to simulate one of these fires conducted in the C-133 test facility in order to provide further validation of the computational approach and the SMARTFIRE software. The experiment involves exposing the interior cabin materials to an external fuel fire, opening only one exit at the far end of the cabin (the same side as the rupture) for ventilation, and noting the subsequent spread of the external fire to the cabin interior and the onset of flashover at approximately 210 seconds. Through this analysis, the software is shown to be in good agreement with the experimental data, producing reasonable agreement with the fire dynamics prior to flashover and producing a reasonable prediction of the flashover time i.e. 225 seconds. The paper then proceeds to utilize the model to examine the impact on flashover time of the extent of cabin furnishings and cabin ventilation provided by available exits

Predicting the likely impact of aircraft post crash fire on aircraft evacuation using fire and evacuation simulation

The SMARTFIRE Computational Fluid Dynamics (CFD) fire field model has successfully reproduced the observed characteristics including measured temperatures, species concentrations and time to flashover for a post-crash fire experiment conducted by the FAA within their C-133 cabin test facility. In this test only one exit was open in order to provide ventilation for the developing cabin fire. In real post-crash fires, many exits are likely to be open as passangers attempt to evacuate. In this paper, the likely impacts on evacuation of a post-crash fire in which various exiting combinations are available are investigated. The fire scenario, investigated using the SMARTFIRE software, is based on the C-133 experiment but with a fully furnished cabin and with four different exit availability options. The fire data is imported into the airEXODUS evacuation simulation software and the resulting evacuations examined. The combined fire and evacuation analysis reveals that even though the aircraft configuration is predicted to comfortably satisfy the evacuation certification requirement, when fire is included, a number of casualties result, even from the certification compliant exit configuration.

Trust, leadership and economic necessity in post-compulsory education

Trust is a complex concept that has increasingly been debated in academic research (Kramer and Tyler, 1996). Research on 'trust and leadership' (Caldwell and Hayes, 2007) has suggested, unsurprisingly, that leadership behaviours influence 'follower' perceptions of leaders' trustworthiness. The development of 'ethical stewardship' amongst leaders may foster high trust situations (Caldwell, Hayes, Karri and Bernal, 2008), yet studies on the erosion of teacher professionalism in UK post-compulsory education have highlighted the distrust that arguably accompanies 'new managerialism', performativity and surveillance within a climate of economic rationalisation established by recent deterministic skills-focused government agendas for education (Avis, 2003; Codd, 1999, Deem, 2004, DFES, 2006). Given the shift from community to commercialism identified by Collinson and Collinson (2005) in a global economic environment characterised by uncertainty and rapid change, trust is, simultaneously, increasingly important and progressively both more fragile and limited in a post compulsory education sector dominated by skills-based targets and inspection demands. Building on such prior studies, this conference paper reports on the analysis of findings from a 2007-8 funded research study on 'trust and leadership' carried out in post-compulsory education. The research project collected and analysed case study interview and survey data from the lifelong learning sector, including selected tertiary, further and higher education (FE and HE) institutions. We interviewed 18 UK respondents from HE and FE, including principals, middle managers, first line managers, lecturers and researchers, supplementing and cross-checking this with a small number of survey responses (11) on 'trust and leadership' and a larger number (241) of survey responses on more generalised leadership issues in post-compulsory education. A range of facilitators and enablers of trust and their relationship to leadership were identified and investigated. The research analysed the ways in which interviewees defined the concept of 'trust' and the extent to which they identified that trust was a mediating factor affecting leadership and organisational performance. Prior literature indicates that trust involves a psychological state in which, despite dependency, risk and vulnerability, trustors have some degree of confident expectation that trustees will behave in benevolent rather than detrimental ways. The project confirmed the views of prior researchers (Mayer, Davis and Schoorman, 1995) that, since trust inevitably involves potential betrayal, estimations of leadership 'trustworthiness' are based on followers' cognitive and affective perceptions of the reliability, competence, benevolence and reputation of leaders. During the course of the interviews it also became clear that some interviewees were being managed in more or less transaction-focused, performative, audit-dominated cultures in which trust was not regarded as particularly important: while 'cautious trust' existed, collegiality flourished only marginally in small teams. Economic necessity and survival were key factors influencing leadership and employee behaviours, while an increasing distance was reported between senior managers and their staff. The paper reflects on the nature of the public sector leadership and management environment in post-compulsory education reported by interviewees and survey respondents. Leadership behaviours to build trust are recommended, including effective communication, honesty, integrity, authenticity, reliability and openness. It was generally felt that building trust was difficult in an educational environment largely determined by economic necessity and performativity. Yet, despite this, the researchers did identify a number of examples of high trust leadership situations that are worthy of emulation.

Tied to the job: affective and relational components of nurse retention

Paper investigates whether affective and relational components of nurses' experience of work have a significant impact on their intentions to leave either the job or the nursing profession in models that control for other factors (sociodemographic, work conditions, perceptions of quality of care) that are known to affect career decisions. [Abridged Abstract]