Theoretical Contributions

This dissertation offers critical insights to the International CG research. With the worldwide initiatives to reform/improve firm and country level CG policies, a large stream of literature has developed to assess the value of this policy scheme. In

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determining the quality of national and organizational governance, CG scholars often employ a number of standardized indices that are developed pertaining to the universal CG policies. While the rigorous investigations across disciplines (economics, finance, law, sociology, political science, and so forth) provide invaluable insights, the findings have been inconclusive in international settings. Scholars have been analyzing the effectiveness of commonly recommended CG policies across various organizations and country institutional contexts. The heterogeneity of CG aspects further get complex when the CG scholars expand their policy analyses into examining other important governance concerns such as protecting interests of all the stakeholders (Aguilera & Jackson, 2003), safe-guarding the natural environment (Sar, 2018), fulfilling corporate social

responsibilities (Stuebs & Sun, 2015), and so forth.

This dissertation is built on the argument that in examining the policy

effectiveness of recommended CG mechanisms, it is crucial to specify the governance concern; identify the actors that are involved in the agency relationships; and finally, incorporate the institutional context where the organizations are embedded in. For the current analysis, I examined the closely-held firms with UCOs from Europe, Asia, and Latin America where Type II agency problem exists between minority shareholders and UCOs. This approach enabled me to perform a relatively bias free investigation as I specified the ‘organizational form’ (concentrated firms), ‘governance concern’ (expropriation of minority shareholders by UCOs), and ‘institutional context’ (Non- Anglo-Saxon countries) of the focal firms. At the organizational level, I analyzed whether the internal mechanisms of Monitoring CG and Incentive CG are aligned with the

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what extent the external mechanisms of legal institution and disclosure standard matter in implementing the formal policies. My approach has been comprehensive in developing an alternative set of policy-related hypotheses, where I addressed the debate between Universal View of CG versus Embedded View of CG. In sum, the current study aims to emphasize the importance of specification in conducting CG research – in absence of which the policy analyses will be incomplete/misleading.

This dissertation also aims at encouraging the CG scholars to utilize the progression of Agency Theory in conducting CG research (Hendry, 2002; Hoenen & Kostova, 2015; Kostova et al., 2016) . Classical Agency Theory had been at the core in shaping the conventional CG mechanisms, which were mostly designed towards governing the stand-alone firms with dispersed owners. Often researchers tend to conclude that Agency Theory is not generating effective CG mechanisms as it is not addressing the differences among national governance systems. Whereas in reality, the worldwide CG reforms mostly were driven by the Anglo-Saxon MODEL, – governance mechanisms of which had been designed employing the classical Agency THEORY. The standardized CG policies were developed for a particular dyad of actors and

organizations, which were embedded in a particular institutional environment. CG scholars need to join the effort by other disciplines and utilize the progression of Agency Theory in designing actor, problem, and context specific governance policies. In

Economics, scholars apply Agency Theory to govern the conflict between employer and employee (Stiglitz, 1975), insurer and insured (Spence & Zeckhauser, 1975), buyer and supplier, lawyer and client, and so forth (Harris & Raviv, 1978). In Political Science, scholars utilize Agency Theory to examine the agency relationship between politicians

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and bureaucrats (Banfield, 1975; Niskanen, 1971). In International Business, scholars suggest for the contextualization Agency Theory to understand the management of multinational corporations (Kostova et al., 2016; O’Donnell, 2000; Roth & Nigh, 1992; Roth & O'Donnell, 1996). The field of CG should advance the research agenda by developing newer and more advanced governance mechanisms and in the process contribute to the progression of Agency Theory research.

This dissertation also contributes to the literature on Decoupling. Traditionally, Decoupling research focused on the gap between formal policies and organizational practices, where the inherent assumptions implied that the formal policies are aligned with achieving the intended goals (Fiss & Zajac, 2004; Westphal, Gulati, & Shortell, 1997). Recent developments in the Neo-Institution literature shifted the focus towards the gap between organizational practices and intended goals (Abrahamson, 1991; Bowen, 2014; Dick, 2015). According to Bromley & Powell (2012), Means-Ends Decoupling occurs when the causal links between formal policies and intended goals are opaque and weak; yet organizations adopt these misaligned policies due to the rationalization of structural forms. Scholars in this line believe that Means-Ends Decoupling will increase overtime with the worldwide initiatives to promote and adopt uniform concrete rules. In the current study, I have employed the idea of Means-Ends Decoupling of CG in

examining the effectiveness of common governance policies. I have incorporated the issue of external institutional environment in distinguishing between the acts of Policy- Practice Decoupling versus Means-Ends Decoupling. The analyses tested the

performance of Monitoring CG and Incentive CG in addressing P-P conflict in firms from both weak institutional context as well as strong institutional context. If the findings

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were positive and significant in the strong context but not in the weak context, then it would indicate that the internal CG policies are aligned with the intended goal of

addressing P-P conflict; insignificant/negative results in the weak context would indicate that the firms are getting way with Policy-Practice Decoupling due to lack in policy implementation. Since the findings are mostly insignificant across the entire analyses, the investigation essentially is pointing towards Means-Ends Decoupling.

Insignificant/negative results particularly in the strong context imply that the internal CG policies by design are not equipped with the means to attenuate P-P conflict; as lack in policy implementation is not a major concern in this instance. By utilizing the Neo- Institutional ideas of Policy-Practice Decoupling and Means-Ends Decoupling, this dissertation provides a relatively bias free understanding of the functionality of CG mechanisms in diverse settings.