Title: The role of codetermination in shareholder oriented corporate governance reform: the case of executive remuneration disclosure

Authors: Mario Krenn

Addresses: Department of Management and Business Administration, College of Business, Southeastern Louisiana University, Hammond, LA 70402, USA

Abstract: This paper examines the influence of employee representatives in German publicly listed firms' supervisory boards on the likelihood that firms adopt a corporate governance code provision that recommends the disclosure of individualised remuneration arrangements of top management team members. My theoretical perspective suggests that depending on the influence of labour representatives in the boardroom, labour influence and individualised top management team remuneration disclosure may be viewed as either complements or substitutes in firms' internal corporate governance structure. The results provide support for my theory and show that there exists an inverted U-shaped effect of the level of labour influence on the supervisory board on the likelihood that firms thoroughly reform their top management remuneration disclosure practices.

Keywords: codetermination; corporate governance reform; shareholder orientation; remuneration disclosure; executive remuneration; employee representation; Germany; labour influence; supervisory boards.

DOI: 10.1504/IJCG.2015.074689

International Journal of Corporate Governance, 2015 Vol.6 No.2/3/4, pp.178 - 193

Received: 14 Aug 2014
Accepted: 01 Oct 2015
Published online: 13 Feb 2016 *

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