Organisational approaches to corporate governance: an empirical study on shareholder activism

It has been argued amply that alternative theoretical approaches to the corporate governance phenomenon can be a valuable complement to the mainstream economic approach. However, such approaches are largely embryonic and empirical studies based on more organisationally oriented theory are few and geographically limited. The purpose of the present article is to discuss the value of organisationally oriented approaches to corporate governance as a complement to more traditional economic approaches. This is accomplished by discussing the findings of an empirical study on Swedish shareholder activism in the light of institutional sociology. The study demonstrates how the preferences and actions of investors are institutionally determined, and not only influenced by regulation and law, but also by moral obligations, societal expectations and relational ties. Thus, the study demonstrates the value of complementing economic explanations with more institutionally and organisationally oriented accounts, in order to better understand shareholder activism in particular, and corporate governance in general.