The effectiveness of e-corporate governance: an exploratory study of internet voting at shareholders’ annual meetings in France

Abstract

Purpose E-corporate governance or the use of technologies and information systems (ISs) in corporate governance, is still a subject that is too seldom addressed in business research. This paper is at the intersection between two fields of research (corporate governance and the management of ISs), which are interdependent in ways that are still unexplored. The paper analyzes the implications of internet voting (IV) at shareholders’ annual meetings (SAM) for the corporate governance of listed companies in France, in particular for the relationship between executives and shareholders. Most of the studies that have dealt with IV at SAM have focused on techno-legal issues and were often conducted by business law researchers. The purpose of this paper is to investigate the implications of the new voting system through the prism of corporate governance. Design/methodology/approach The authors proceeded by triangulation of methods. This qualitative study is based on observations, interviews and documentary analysis. It assessed the IV implications for both the issuing companies and the shareholders. Findings The new voting system brings undeniable competitive advantage to the issuing company and facilitates shareholders’ activism, yet it has serious risks both for the corporations and for certain categories of the shareholder. Interestingly, the authors propose an original and field-grounded typology that distinguishes the risks and benefits associated with IV in relation to executives’ attitudes. Social implications The paper shows that the resolving of identified deficiencies with IV development could contribute to the alignment of companies’ interests with those of shareholders. Moreover, the study calls for policymakers to appoint an official body to regulate the practical implementation of the new system and to prevent its dissemination being held hostage to the executives’ willingness. Originality/value An original aspect of this research lies in the effective operationalization of the constructs of corporate governance effectiveness with a view to examining corporate governance as a set of technologically mediated practices. Moreover, this study emphasizes the key role of the construct of “executives’ willingness” in facilitating/impeding IV diffusion. This underlies their attempts to reverse the corporate governance relationship.

Bibliometric analysis on corporate governance topics published in the journal ofCorporate Governance: The International Journal of Business in Society

“…In the second group, studies have analyzed the impact of corporate governance on investors’ investment decisions, such as portfolio selection (Lassoued and Elmir, 2012), investors’ perceptions (Ebaid, 2013), private equity (Latini et al , 2014), market liquidity (Afrifa and Tauringana, 2015), takeover vulnerability (Chatjuthamard et al , 2021) and likelihood of financial distress (Udin et al , 2017). The third group focuses on the adjustment of corporate governance systems, such as the development of a new code (Shehata, 2015), corporate governance compliance (Albu and Gîrbină, 2015), financial crisis consequences (Orazalin and Mahmood, 2019), e-corporate governance effectiveness (Abdennadher and Cheffi, 2020), COVID-19 pandemic (Tan, 2021), blockchain technology (Singh et al , 2020) and optimal corporate governance (ElKelish and Zervopoulos, 2022). In the fourth group, studies have analyzed the associations between corporate governance and different agency relationships, such as agency conflicts (Tompkins and Hendershott, 2012), shareholder activism (Ghahramani, 2013), relationships with stakeholders (Wanyama et al , 2013), separation between control and management (Carlo, 2014), executive compensation (Pereira, 2015), agency costs (Garanina and Kaikova, 2016), blockholders’ voting power (Wang, 2016), managerial discretion (Haj Youssef and Teng, 2019), institutional power (El-Diftar et al , 2017) and workplace happiness (Ravina-Ripoll et al , 2021).…”

“…The third group focuses on the adjustment of corporate governance systems, such as the development of a new code (Shehata, 2015), corporate governance compliance (Albu and Gîrbină, 2015), financial crisis consequences (Orazalin and Mahmood, 2019), e-corporate governance effectiveness (Abdennadher and Cheffi, 2020), COVID-19 pandemic (Tan, 2021), blockchain technology (Singh et al , 2020) and optimal corporate governance (ElKelish and Zervopoulos, 2022).…”

Environmental awareness and shareholder proposals: the case of the Deepwater Horizon oil spill disaster

“…2 For additional resources, see also Korac-Kakabadse et al (2001), Denes et al (2017), Guimaraes et al (2018), Abdennadher and Cheffi (2020). …”

“…Media, regulators and market players increasingly request firms to discuss whether and how they deal with environmental risks. At the same time, recent literature has paid more attention to shareholder activism (Korac-Kakabadse et al , 2001; Denes et al , 2017; Cundill et al , 2018; Guimaraes et al , 2018; Yang et al , 2018; Abdennadher and Cheffi, 2020), an evolving characteristic of financial markets (Gillan and Starks, 2000; Goranova and Ryan, 2014) and increasingly considered a corporate governance tool (Ferri and Sandino, 2009; Ertimur et al , 2011; Renneboog and Szilagyi, 2011; Goranova and Ryan, 2014; Viviers and Mans-Kemp, 2020). This paper studies whether the deepwater horizon (DH) oil spill in 2010 (hereafter “oil spill”) affected shareholder activism channeled through environmental shareholders’ proposals.…”

“…For additional resources, see alsoKorac-Kakabadse et al (2001),Denes et al (2017),Guimaraes et al (2018),Abdennadher and Cheffi (2020).3 One of these groups is Chevedden Group, whose focus before the years 2017 and 2018 was more towards governance.4 This concept refers to what the authors call "balance of reason." 5 See, for instance, Huang et al (2014), Hassan et al (2018), Bacha and Ajina (2019), D'Augusta and DeAngelis (2020).6 Proxy Monitor offers a publicly available database that tracks shareholder proposals in (almost) a real-time fashion.…”