Corporatization

8 Key excerpts on "Corporatization"

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  State-Owned Enterprise Reform in Vietnam

  Lessons from Asia

  • Chee Yuen Ng, Nick John Freeman, Frank Hiep Huynh(Authors)
  • 2018(Publication Date)
  • ISEAS Publishing

    (Publisher)

  8 Corporatization as a Strategy of State-Owned Enterprise Reform Ian Thynne I. Introduction Notwithstanding the flurry of divestment activity around the world over the last ten to fifteen years, state-owned enterprises (SOEs) continue to occupy a prominent place in many societies. Indeed, while numerous enterprises have been divested in part or in full, others have been relatively untouched by divestment decisions. New ones have also been established in areas of considerable public concern, including health and education. In these and other cases, governments have recognized a definite need, on the one hand, to remain in the business of producing or providing selected goods and services in the public interest but, on the other, to enhance by various means the capacity of the relevant enterprises to cope with the demands that are inevitably made on them. One such means, in circumstances in which it has not already been adopted, is to transform the enterprises into legally, free-standing corporate entities through a process of Corporatization. It is this means which is addressed here by drawing, in large part, on material published elsewhere over the last two years (Thynne 1994a, 1995). 11. Modes of Corporatization In practice, there are two main modes of Corporatization which need to be examined with reference to the four broad types of organizations whose basic characteristics are outlined in Table 8.1. Both modes seek to increase an enterprise's operational flexibility and viability by giving it an existence as an established legal entity which is legally separate from that of a government. This separate status as a recognized 'legal person' enables the enterprise to enter into contracts, to buy and sell property, and to sue and be sued in its own corporate name (Birkinshaw, Harden, and Lewis 1990; Boo 1989; Coates 1990; Taggart 1990, 1993; Wettenhall1990, 1993b, 1995; Thynne 1991, 1994b). In other important respects the two modes are different from each other.

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  The Routledge Handbook of State-Owned Enterprises

  • Luc Bernier, Massimo Florio, Philippe Bance, Luc Bernier, Massimo Florio, Philippe Bance(Authors)
  • 2020(Publication Date)
  • Routledge

    (Publisher)

  Consequences for public enterprises A second wave of Corporatization Privatization, as mentioned above, was promoted to minimize costs in government budgets. But it also had an impact on the way SOEs were managed, hence the relevance of the governance of SOEs (Bernier, 2011). Governments wanted to minimize costs in order to allocate resources to social programs and, therefore, adopted policies designed to introduce private sector criteria (the so-called “ new public management ” ) and eventually favoured institutional arrangements that could make enterprises more cost conscious. One way to obtain this result was to resort to public corporations separated from the structure of government and operating under corporate law, but still under either local or central public control. Public corporations have always existed. After WWII a big wave of cor-poratization took place, concurrent with the nationalizations of that period. A second wave came in the 1980s and 1990s. In some cases, Corporatization was the fi rst step of true privatization, but frequently in the public utility sector, governments maintained control either through total ownership of the shares or a majority or even a minority share, in any case maintaining a de facto control in the management of the company. The idea was to make managers more independent, less vulnerable to political pressure and to introduce a hard budget constraint with a fi nancial bottom line (Clifton & Diaz-Fuentes, 2018). Therefore, public corporations were a combination of public ownership and a private structure that allowed governments to maintain control while providing an incentive to attain social objectives in an e ffi cient way, without making the enterprise purely commercial. Since private capital needs a return in order to remain in a corporation, there was an obvious con fl ict of interest with the “ public mission ” if potential pro fi t was lowered. 38 Giuseppe Bognetti

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  The Gift of Education

  Public Education and Venture Philanthropy

  • K. Saltman(Author)
  • 2010(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  1 Foregrounding Venture Philanthropy: The Corporatization of Public Schools T his book details a number of ways that VP stands to corporatize public schools from pedagogical approaches to curriculum, from transformations in governance and administration to changes to teacher and administrator preparation. This chapter foregrounds that discussion by providing a critical overview of the corporatiza- tion of schools, situating it in terms of broader political and educa- tional trends. If, as this book contends, the Corporatization of schools is a major problem with the business-oriented agenda of VP, then it is crucial to break down precisely what is meant by the cor- poratization of schools. This chapter serves as both a background for the following chapters that detail the multifaceted corporatiza- tion agenda of VP, and it serves as a starting point for the discussion of the problem of educational economism developed in the last chapter. The Corporatization of schools is part of a broader assault on public and critical education and the aspirations of a critical democ- racy. By the “Corporatization of public schools,” I mean both the privatization of public schools and the transformation of public schools on the model of the corporation. In what follows, I schema- tize Corporatization in terms of economic, political, and cultural transformations. More specifically, I consider how the corporatiza- tion of public schools redistributes economic control and cultural control from the public to private interests. I argue that these inter- twined redistributions of power undermine public democracy (the possibilities for the development of a more participatory and deeper democracy), just social transformation, and critical citizenship while exacerbating material and symbolic inequality. The Gift of Educ ation 14 Criticism of the Corporatization of public education is predomi- nantly restricted to the critical and radical political traditions.

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  Privatization in Eastern Europe

  Is the State Withering Away?

  • Roman Frydman, Andrzej Rapaczynski(Authors)
  • 1994(Publication Date)
  • Central European University Press

    (Publisher)

  (1991). Martin Gargiulo and Markus I

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  Privatization and the Welfare State

  • Sheila B. Kamerman, Alfred J. Kahn, Sheila B. Kamerman, Alfred J. Kahn, Sheila Kamerman, Alfred Kahn(Authors)
  • 2014(Publication Date)
  • Princeton University Press

    (Publisher)

  Now I want to spell out some of the contextual factors and critical choices that shape what privatization means in prac- tice and that help to explain why political practice often conflicts with theory. THE POLITICAL CONTEXTS AND USES OF PRIVATIZATION The meaning of privatization depends in practice on a nation's position in the world economy. In the wealthier countries it is easy to treat priva- tization purely as a question of domestic policy. But where the likely buy- ers are foreign, as in the Third World, privatization of state-owned enter- prises often means denationalization—a transfer of control to foreign investors or managers. Since state ownership often originally came about in an act of national self-assertion, privatization appears to be a retreat in the face of international pressure. In that sense, national memory colors the meaning of privatization. Even in the United States, privatization would be understood rather differently if public assets up for sale or con- tracts up for bid were likely to be taken over by the Russians or the Jap- anese. The more dependent a nation on foreign investment, the greater the likelihood that privatization will raise the prospect of diminished sov- ereignty and excite the passions of nationalism. Where privatization raises such issues, it is often blocked, or citizens and domestic firms are reserved exclusive rights to publicly offered assets, shares, or contracts. In many Western countries, state ownership owed more in the first place to nationalist than to socialist sentiment; hence it is scarcely surprising that nationalism is liable to derail or distort privatization plans. Throughout the world, the privatization of enterprises with strategic military or economic significance raises especially sensitive questions of sovereignty and security. In most oil-producing countries, for example, no government is likely to try to privatize the state oil companies because of the likely domestic political reaction.

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  Large Chinese State-Owned Enterprises

  Corporatization and Strategic Development

  • Y. Zhang(Author)
  • 2007(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  2.4. Corporatization reform This section sets out to present the policy objectives of Corporatization reform. It also reviews the supplementary measures implemented which were deemed essential for the success of Corporatization reform. Reform, Corporatization and Strategy Theories 3S 2.4.1. Policy objectives of Corporatization Corporatization is one of the key measures in the larger policy of the MES and the core of Corporatization is ownership restructuring. The main objective of the strategy of ownership restructuring is to clarify the ambi- guities in SOEs' property rights; to continue the development of manage- ment autonomy; strengthen incentives to management and improve the corporate governance. Specifically, such an ownership restructuring strat- egy is seen as a means of transforming SOEs from public sole ownership controlled by specific government agencies at various administrative lev- els into modern corporations which enjoy such attributes as independent decision making, diverse ownership without diminishing the authority of public ownership, and fully guided by markets (Lin and Zhu, 2001: 305). According to Hassard et al. (1999: 70), the working definition of the MES in general and Corporatization reform in particular is 'reform (gaige), reconstruction (gaizao), and restructuring' (gaizu). Its main elements are: • 'clarification of property rights (chanquan qingxi). • clear definition of rights and responsibilities (zequan fenming). • distinguishing between government and management functions (zhengqi fenkai). • scientific enterprise management' (guanli kexue). The first three elements demonstrate how China's centrally planned economy transitioned to a market economy (Tam, 2002: 307). 'To real- ize these aims in practice', Hassard et al.

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  Corporate Social Responsibility and the Shaping of Global Public Policy

  • M. Hirschland(Author)
  • 2006(Publication Date)
  • Palgrave Macmillan

    (Publisher)

  Part I First Things First—The Early Rise of the Corporation Despite its present ubiquity, the modern corporation is a relatively new creation. As a modern economic institution, it has been with us for a relatively short period of 150 years. 15 Over this period, it has changed Managing Global Economic Transformations 39 from a strictly publicly chartered and closely controlled entity to its largely private, independent, and transnational form today. As it has changed, so too have the efforts to regulate how its activities impact the societies where it operates. For much of their early history, both chartered and unchartered business enterprises possessed none of the hallmarks of the modern business corporation: They had no limited shareholder lia- bility for the actions they took, and no free will to acquire assets without the express permission of governments; they were limited in terms of their overall capitalization, were chartered for periods typically not exceeding 20 years (and then dissolved), and were subject to “reserve clauses” within their charters allowing their operations to be altered or even shuttered by government decree. The presence of the corporation today and the scope of its transnational power make it easy to forget these facts. The unique powers vested in the modern corporation have come as the result of hard-fought battles. Before the advent of general incorpo- ration statutes with which we are familiar today, the state played a pow- erful role in regulating commerce and the actors engaged in it. Prior to the American Revolution, the history of the corporation traces its roots to Great Britain. Though the focus here is on the American experience with the corporation, a few words on this precursory period are in order. The First Corporations During the sixteenth and into the seventeenth century, it was quite common for boroughs and guilds (towns and labor unions of the day) to obtain royal charters.

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  Hostile Business and the Sovereign State

  Privatized Governance, State Security and International Law

  • Michael J. Strauss(Author)
  • 2018(Publication Date)
  • Routledge

    (Publisher)

  3    Companies for privatized activities

  The flip side of privatization

  The trend toward privatizing state functions has been accompanied by a parallel movement whose magnitude is equally great: the expanding global presence of commercial enterprises that carry out activities once done by governments. The companies may perform these functions as their sole or primary source of revenue, or they may be engaged in other activities as well, related or unrelated to aspects of governance. Without businesses to take over what governments privatize, the privatization movement could not achieve its scope or intensity. The companies must be in place, or be created, to ensure the continuation of the activities that states divest but want maintained rather than terminated.

  In contrast to the enormous global attention that the privatization trend has received, this corollary movement remains essentially unexplored as a major international trend in its own right, even if some notice has been given to the phenomenon as it pertains to individual sectors of activity (e.g ., the rise of companies performing privatized military functions).1 Its very presence shows there is a widespread willingness among businesses to assume the activities that states privatize, although little if anything is known about why this willingness exists or the consequences it may have for states.2

  It is normal for any company’s choice of business activity to arise from a perceived opportunity for financial gain, but when the activity is a privatized state function there may be other reasons for desiring to carry it out, particularly if the activity can be associated with some degree of political power or territorial authority. A single company may accumulate multiple privatized activities – different activities divested by the same state, or the same activity divested by different states – so whether its motive is strictly business-related or something more, or something else entirely, becomes relevant as a factor in matters such as territorial control, and by extension state sovereignty.

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