Lessons for Britain from German corporate governance

Article Abstract:

British companies would gain little by giving up the proven benefits of the unitary board in favor of the untested virtues of the two-tier German board structure. While British companies would definitely benefit from a greater emphasis on the monitoring duties of corporate boards, it would be unwise for them to discard the unitary board system altogether. The better approach to corporate governance reform would be for them to tighten up the monitoring function while improving selection procedures for outside directors. By placing their faith in the process of incremental reform and by encouraging the active participation of large institutional investors, British companies would be more likely to obtain the desired improvements in governance than if they opted to make radical changes in the structure of corporate boards.

Germany, International aspects, Column, Corporate governance, Corporations, German

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Group HQ: nerve centre or ivory tower

Article Abstract:

Corporate headquarters (HQ) are frequently a key source of the wasteful overhead expenses that add little value to a corporate group's performance. An increasing number of multibusiness companies, searching for ways to cut costs, have begun to dramatically streamline their head office operations. Many more companies are reevaluating the role of a group HQ and the necessity of allocating scarce resources to it. Ways by which companies can improve the value they receive from maintaining head offices include disposing of central services staff that merely duplicate the functions of services staff at business units, focusing the head office's efforts on strategic planning and management, and using it as a base to improve the monitoring and evaluation of various business units' operations.

Analysis, Organizational effectiveness, Great Britain

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