From Stakeholders to Shareholders. Corporate Governance Networks in The Netherlands 1976-1996

Abstract

In this paper we analyse the networks of interlocking directorates among the 250 largest Dutch corporations in 1976 and 1996. In 1976 there was a relatively dense and centralised network in which the banks were the central hubs. Twenty years later the network had become much thinner and financials played a less prominent role in the network even though they remained important hubs. Overall the number of interlocks decreased well nigh 25%, the interlocks between finance and industry even with almost 40%. The number of multiple interlocks of the financial institutions with industry decreased substantially. Even though the Dutch network had become sparser, it remains compact and connected. Apparently the network did become more efficient as a communication network, while corporate control through personal interlocks has diminished. Thus a Rhineland type of industrial/financial business group system, still visible in 1976, had evolved by 1996 into a wider business community network of autonomous holdings. These changes could also indicate a shift towards a more shareholder-oriented regime of corporate governance.