The contribution of network governance to preventing opportunistic behaviour by managers and to increasing stakeholder involvement: the Eroski case

Abstract

This present work is an exploratory analysis of network governance models that are characterised by widespread distribution of decision–making and control, auditing and supervisory functions in company structure, frequently through stakeholder engagement in the management system. In the study, we verify the way in which NG can involve stakeholder representatives in the governance bodies and in the decision–making process, also preventing opportunistic behaviour of management, according to the stakeholder–agency theory. A case study of network governance is presented regarding the Spanish cooperative Eroski - a self–governing organisation, with direct participation by representatives of the various stakeholder categories in the main governing bodies. In the conclusions, we discuss the strengths and weaknesses of the network governance system and its implications for theory and practice and we describe an incremental approach, on an entirely voluntary basis, for implementing this governance model in other corporations, including non–cooperative ones.