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Boards of Directors as Strategists in an Enacted World – The Danish Case

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  • Søren Christensen
  • Ann Westenholz

Abstract

We argue that Boards of Directors of Danish companieshave been socially constructed as an importantdecision making body in the companies. Since 1974,employees have elected members to the Board ofDirectors. Today they can elect one third of the Boardmembers. In spite of this new composition of theBoard, it has emerged as a team that has been able toconvince the stakeholders, the press, and the publicabout its important standing in the management of thecompany. To understand this development we look at fourdifferent perspectives. (1) The changing businessenvironment that has framed the development:globalization, mergers and acquisitions, increasedcompetition, technological innovations, strategicalliances, political consumers, and ethical issues are factors that have been the motor for this change. (2)We use a radical social psychological version ofleadership theory (Meindl, 1993) to understand thesocial construction of the change of the role of theBoard of Directors that has occurred. We argue thatthe stakeholders and the society at large haveascribed importance and leadership to the Board, andthat it plays an important role as strategist in thecompanies. (3) We see the board as a theater ensemblestaging a performance for the audience (stakeholdersand the wider environment) using Erving Goffman's``Presentation of Self in Everyday Life'' (1959) as atheoretical point of departure. From this point ofview, the role of the Board is to socialize newmembers, to maintain its unity, and to successfullyplay the role of strategists. (4) To understandstrategists you may understand the company and itsenvironment in either realist terms (objectiveenvironments) or in social constructivist terms(enacted environments) (Smircich and Stubbart, 1985). We adopt the enactment position. Copyright Kluwer Academic Publishers 1999

Suggested Citation

  • Søren Christensen & Ann Westenholz, 1999. "Boards of Directors as Strategists in an Enacted World – The Danish Case," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 3(3), pages 261-286, September.
  • Handle: RePEc:kap:jmgtgv:v:3:y:1999:i:3:p:261-286
    DOI: 10.1023/A:1009977806089
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    References listed on IDEAS

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    Cited by:

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    2. Pieter-Jan Bezemer & Stefan Peij & Gregory Maassen & Han Halder, 2012. "The changing role of the supervisory board chairman: the case of the Netherlands (1997–2007)," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 16(1), pages 37-55, February.
    3. Shardul Shankar & Vijayshri Tewari, 2023. "Impact of Collective Intelligence and Collective Emotional Intelligence on the Psychological Safety of the Organizations," Vision, , vol. 27(4), pages 458-473, August.
    4. Steen Thomsen & Caspar Rose & Dorte Kronborg, 2016. "Employee representation and board size in the Nordic countries," European Journal of Law and Economics, Springer, vol. 42(3), pages 471-490, December.

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