National and international interlocking directorates within Europe: corporate networks within and among fifteen European countries

Abstract

This article focuses on the structural aspects of interlocking directorate networks within and among fifteen European countries. The results show large quantitative differences in network densities within countries. These differences are strongly and significantly related to the ‘variety of capitalism’ in place. Second, an analysis of the interlocking directorates across country borders reveals a European interlocking directorate network in which different countries take quite different positions. As it turns out, a country's international position is strongly and significantly related to its EU membership duration. Additionally, there are indications of a link between the structure of the interlocking directorate network within a country and how that country is positioned in the international network. Data were collected in 2006 concerning 362 corporations with 6115 board positions in fifteen European countries.

Keywords:

• board of directors
• corporate networks
• European Union
• interlocking directorates
• varieties of capitalism

Acknowledgements

For this paper, we used parts of the dataset of the European Top Managers Project at the University of Groningen, The Netherlands. We would like to thank Janine Elbertsen, Floris de Haan, Floris van der Lee and Ilse Marsman for their assistance in the data collection. We thank the participants in the Corporate Governance track of the EURAM conference 2008 and Frans Stokman for their useful comments on earlier versions of the paper.

Notes

1. There are only a few exceptions. Most notably, there are a few companies with roots in more than one country. SHELL and Unilever have been assigned to the Netherlands, Fortis to Belgium. This is rather arbitrary, but excluding these companies from the analyses only marginally changed the statistical outcomes and did not change the conclusions of this paper.

2. Hall and Gingerich (2004) do not report values for Greece and Luxembourg, so we excluded them from our analysis.

3. Our calculations are based on Kentor and Jang (2004, p. 362).

4. This might be the reason why Stokman and Wasseur (1985) presented rather low density measures for 1976. Economic integration probably stimulated the number of European interlocking directorates, which led to lower densities than in 2005. However, it is too early to be certain of this conclusion. They also used samples of 200 corporations per country. This made the density measure vulnerable to size effects.