Opportunism in Corporate Management

Stanislaw Rudolf

doi:10.18778/0208-6018.345.04

Abstract

A growing interest in the phenomenon of economic opportunism can be mainly explained by new institutional economics (NIE). It has changed the limitation of that phenomenon into the main method of increasing the efficiency of business entities. Opportunistic attitudes and behaviour can be particularly observed in a business entity. A tendency towards opportunism should be considered both while entering contracts and while developing a strategy for a company. The article is aimed at presenting the essence of opportunism and at defining its place in new institutional economics. It is also aimed at identifying opportunistic attitudes in corporate operation and at indicating the ways to limit such attitudes. While analysing the role of opportunism in corporate management, the main focus shall be set on opportunistic interdependencies in corporate governance. Opportunistic attitudes may be presented not only by the management board of a company but also by its other stakeholders. They may use incompleteness of agreements that have been entered into or asymmetry of information in order to increase their gain at the expense of others. The article provides a more detailed analysis of opportunistic attitudes presented by employee organisations in highly developed countries as well as in post‑communist countries, where opportunism is manifested in demanding attitudes or in protection of monopolist positions.

Highlights

A growing interest in the phenomenon of economic opportunism can be main‐ ly explained by new institutional economics (NIE)
It recognises the variety of their objectives, tastes and opin‐ ions. It identifies their opportunistic attitudes and behaviour, vis‐ ible in an enterprise. Their tendency towards opportunism leads to a conclusion that it should be considered both while entering contracts and while developing a strategy for a company1
The article is aimed at presenting the essence of opportunism and at defining its place in new institutional economics

Summary

Introduction

A growing interest in the phenomenon of economic opportunism can be main‐ ly explained by new institutional economics (NIE). In NIE, considering the com‐ plexity of the decision‐making process as well as a limited range of knowledge and information, it is possible to discuss limited rationality at its most. It should be understood in the following way: people who make decisions are able to determine what transaction costs can be incurred to achieve indispensa‐ ble or additional information. NIE does not completely reject the assump‐ tion referring to rationality of undertaken actions, but it modifies that assumption and brings it closer to the current reality It assumes that individuals follow their personal interest, with limited reference to the public interest. In the third part of the study, which discusses the question of opportunism observed in employee organ‐ isations, the Author refers to the knowledge based on his own experi‐ ence related to employee participation in Poland and in other countries of Central and Eastern Europe

The essence and sources of opportunism

Opportunism in corporate governance

Opportunism of employee organisations

Conclusions