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Abstract
During the last few years, the local government sector in European countries has undergone a number of important changes. Among the various reform initiatives has been the externalization of public services, such as corporatization, contracting-out, public–private partnerships and privatization. The key goal of this article is to describe and explain the evolution of local public services provision in the two selected countries, with a particular focus on ‘corporatization’. The article seeks to draw a picture of the actual municipal landscape with the administrative core and its various corporations. Furthermore, it will discuss the reasons for corporatization trends and their impact on the corporate governance structures of municipalities in Germany and Italy.
Notes
The phenomenon of autonomization is currently the subject of an international research network called COBRA, which investigates the types, characteristics, causes, and effects of autonomization in the public sector; for more details: www.publicmanagement-cobra.org/
Forty-three per cent of all LG debts in Germany relate to their corporations and are ‘hidden’ in the various financial reports of those companies, according to recent data from Junkernheinrich and Micosatt (Citation2007: 16).
This applies for corporations with more than 2,000 employees; corporations with <2,000 but >500 employees only have one-third of their employees as representatives on the Board, in smaller corporations employee representation is not compulsory.
The Board has the authority to delegate some of its functions to one or more subjects (to the CEO and/or the Executive Committee) who are answerable to the Board, beyond the duties assigned to them, for the correct ‘use’ of the powers conferred.