Journal Article

Board involvement in international joint ventures

Reuer, Jeffrey J., Lioukas, Constantinos S., Klijn, Elko

2014

Overview

The last two decades have witnessed substantial scholarly interest in corporate boards, yet little research has been devoted to boards of international joint ventures (IJVs). We combine the corporate governance and alliance governance literatures in order to study this important ex post governance mechanism for IJVs. We identify a fundamental tension inherent in IJVs, which arises from the unique features of this organizational form and influences the level of involvement by their boards. International joint ventures are hybrid organizational forms that can require administrative control to facilitate monitoring and coordinated adaptation in the presence of exchange hazards. At the same time, the fact that IJVs operate in different host countries can make it efficient to delegate authority to local management for certain collaborations. In investigating the determinants of IJV board involvement, we therefore examine characteristics of IJVs that reflect this underlying tension. We conclude that board involvement reflects efficiency considerations in individual ventures, and the administrative control provided by boards is an important dimension of IJV governance.

• Publisher: John Wiley & Sons, Ltd,John Wiley & Sons,Wiley Periodicals Inc
• Subject: Alliances / Boards of directors / Business entities / Collaboration / Coordinate systems / Corporate boards / Corporate governance / Corporate strategies / Delegation of authority / Economic analysis / Economic concentration / Governance / Host country / international joint ventures / international joint ventures; corporate governance; boards of directors / Joint ventures / Management theory / Organizational behavior / Strategic management / Studies