Decision Rights Research Articles

Powerful political corporate appointments and firm bribery channels

PurposeThe authors examine the influence of powerful political corporate appointments on the usage of firm bribery channels. Party Secretaries within Chinese state-owned enterprises (SOEs) may simultaneously hold top management positions, thereby endowing powerful firm-level decision rights on those appointees, hereafter referred to as powerful dual role Party Secretaries.Design/methodology/approachThis study employs panel data analysis with industry and year fixed effects. The authors use a sample of 1,143 Chinese SOEs listed on the Shanghai and Shenzhen Stock Exchanges from 2004 to 2015.FindingsThe authors find that powerful dual role Party Secretaries are associated with greater bribery channel usage. Following the ongoing anticorruption campaign, SOEs with the powerful appointments significantly reduce their usage of both transparent (entertainment and travel costs) and opaque bribery (abnormal management expenses) channels. However, in general, Chinese SOEs respond to the anticorruption shock by switching from the more transparent to the opaquer bribery channel.Originality/valueThe authors contribute to the ongoing debate of politicians on corporate boards by examining the relatively unexplored area of government appointed top management and their influence on bribery at the firm level.

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Performance, risk, and overflows: When are multiple management control practices related?

Current research relates multiple control practices as packages, systems, or accumulations. This relationship signifies that management control practices exist as multiplicities and interact in various ways. These interactions strengthen management control practices. However, this generalisation misses the when of relations, which is a problem, as management control practices are not always related, for example, because they often have their own domain attached to an organisational entity’s tasks. This paper reports on a study of a firm’s (Automaker) management control of its supply chain. This was organised as two types of concern – risk and performance management – that were delegated to two organisational entities each having its associated management control practices. This organisation was a delegation of responsibilities, decision rights and control practices. The study draws on Michel Callon’s distinction between framing and overflow to analyse the framing activity involved in upholding this separation and the overflows stemming from the difficulties of upholding strong framings. In effect, the paper discusses when risk and performance management practices are related, un-related and re-related and concludes that the when helps explain how the relation works to rearrange the importance of the framings and via overflows to introduce completely new framing devices.

Autonomy and the social dilemma of online manipulative behavior

Persuasive online technologies were initially designed and used to gain insights into the online behavior of individuals to personalize advertising campaigns in an effort to influence people and convince them to buy certain products. But recently, these technologies have blurred the lines and morphed into technologies that covertly and gradually manipulate people into attaining a goal that is predetermined by the algorithm and disregards the decision-making rights of the individual. This may lead to people exercising decisions that do not align with their personal values and beliefs, and rob them of their autonomy—an ethical principle, in the absence of which the application of these technologies may be unethical. However, not all technologies that are persuasive are necessarily manipulative which require the careful consideration of a couple of elements to determine whether or not technologies are manipulative and ultimately whether their application is ethical or not. In this article, we analyze the ethical principle of autonomy and unpack the underlying elements of this ethical principle which must be considered to determine whether the application of a technology is ethical or not in the context of it being persuasive or manipulative.

Designing data governance in Brazil: an institutional analysis

Data governance is a decision-making process focused on authority building to specify decision rights and accountability that encourage desired behaviors regarding data use, security, integrity, and availability. The emergence of big data technologies to design public policy and deliver public services requires governments to design data policy and governance. This paper analyzes the dynamics of data governance design in the Brazilian Federal Government, based on institutional analysis and policy development. The paper reports a series of interviews with Brazilian Federal Government policymakers to frame the data policy design dynamics. The paper concludes that the policy design dynamics to data governance are path dependent and shape actions situations that reinforces previous institutions. In the case of the Brazilian Federal Government, the institutional framework is ambiguous, creating situations of conflict and ineffectiveness in the design of the data policy.

Allocation of Decision Rights and CSR Disclosure: Evidence from Listed Business Groups in China

Corporate social responsibility (CSR) research has recently begun to focus on the CSR performance of business groups, with the scope shifting from group members to business groups in general. This paper focuses on whether business groups with centralized decision rights tend to disclose more CSR information and investigates the heterogeneous effect of the number of subsidiaries. Using a dataset for listed groups in China from 2010 to 2020, our empirical test discovered that centralized decision rights could promote group CSR disclosure. For groups with many subsidiaries, centralization makes a more significant contribution to promoting CSR disclosure. The mechanism test revealed that this positive relationship between centralization and disclosure relies on efficient internal capital market allocation, a reduction in rent-seeking behavior of subsidiaries, and reputational concerns. Furthermore, we observed that the centralized decision rights influence on disclosure varies across different aspects of CSR, with a negative impact on “Social Contribution” and a positive impact on “Shareholder Responsibility”, “Employee Responsibility”, “Supplier, Customer, and Consumer Responsibility” and “Environmental Responsibility”. Centralized decision rights promote more CSR disclosures with voluntary disclosures, while regulatory disclosures have no significant effect. We research the allocation of decision rights and group CSR disclosure.

Administrative and legal status of religious organizations in Ukraine: structure and features of its elements

The article characterizes the administrative and legal status of religious organizations in Ukraine, defines its structure and features of its elements. It was found that the administrative and legal status of a religious organization is a complex polystructural category that reflects the system of legally established and guaranteed by the state rights, responsibilities of religious organizations in relations with public authorities, legal personality of religious organizations, administrative and legal guarantees and protection of the legal capacity of these organizations and their responsibilities to profess and disseminate religious beliefs and teachings, to oppose other participants in public relations in case of violation of the rights of religious organizations, and the state, including public administration bodies on the other hand, to control the rule of law this process, eliminate violations of citizens' rights by religious organizations.
 The following characteristics of the legal status of a religious organization as a participant in administrative relations: non-entrepreneurial nature and non-profit organizational unity, state registration, property separation, the ability to protect their rights in public law, challenge actions and decisions of public authorities, be a plaintiff in court, to carry out activities to satisfy the religious rights and interests of believers and to spread religious beliefs and disciples.

Managing Uncertainty: An Experiment on Delegation and Team Selection

We study how organizations use team selection and delegation of authority jointly to navigate uncertain environments. To do so, we model a managerial decision environment in which a manager both determines the skill heterogeneity of the workers and determines whether to retain or delegate the ability to allocate tasks. Delegation enables better-informed workers to allocate tasks more efficiently when uncertainty is high relative to the incentive conflict between manager and worker. Our novel approach allows us to illustrate that this conflict is endogenously determined by the team selection decision. Experimental data support—although not globally—the direction of our theoretical hypotheses and offer insight into how and why choices deviate from expected behavior. Notably, we identify behavioral characteristics that aid decisions along each dimension. Deliberative thinking improves all decisions under low uncertainty and improves team selection regardless of the level of uncertainty. Risk tolerance improves all decisions in highly uncertain situations and helps managers optimally delegate decision rights in all settings. The results highlight potentially costly ways in which managers seek to simplify their decisions but show how deliberative thinking and risk tolerance can improve performance in a complementary manner. History: This paper has been accepted for the Organization Science Special Issue on Experiments in Organizational Theory. Funding: The authors thank Florida State University and the Barcelona Graduate School of Economics for financial support. Supplemental Material: The data files and online appendix are available at https://doi.org/10.1287/orsc.2021.1545 .

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The impact of hiring local managers on foreign venture capital performance: evidence from China

PurposeThis study examines whether recruitment of local managers helps foreign venture capital (VC) firms mitigate the liability of foreignness measured by cultural differences and improves their performance in relationship-based emerging markets such as China.Design/methodology/approachFrom a data set comprising 1,939 Chinese portfolio companies with first-round investments by 282 foreign lead VC firms during 2000–2015, the study tracks the outcome of each investment until the end of 2018 and collects the background information of partners of lead VC firms. A survival analysis using the Cox hazard model is conducted.FindingsCultural differences of the foreign VC's home country, when compared to China, positively influence the success of VC firms. Recruitment of local managers reinforces this positive influence. The influence of local manager recruitment is more pronounced for VC firms with politically connected local managers, during politically uncertain periods, in industries supported by the government, in provinces with high government intervention and in VC firms with decentralized decision rights given to local managers.Originality/valueThis research complements the international business literature on the advantages of hiring local managers and identifies the channels through which local managers help foreign VC firms obtain relationship-based resources. The findings also have practical implications for those foreign investors who intend to enter into relationship-based emerging markets.

The Impact of Decision Rights on Innovation Sharing

Although innovation sharing between a buyer and a supplier—a common practice in the automotive industry—can increase the efficiency and total profit of a supply chain, suppliers are often reluctant to do so. Sharing innovations would leave the supplier in a vulnerable position if the buyer were to exploit the information (e.g., by resharing the supplier’s innovation with competing suppliers). Anecdotal evidence from automotive suppliers tells us that the nature of a supplier-buyer relationship for the most part depends on who (e.g., a short-run-focused procurement manager or a long-term-focused engineer) manages the relationship. In this paper, we examine how the allocation of decision rights to short-run- and long-run-focused employees affects collaboration between the firms. To accomplish this, we model a relationship between a supplier and a buyer where the buyer is a dual decision maker, consisting of long-run- and/or short-run-focused employees. We characterize the equilibrium of this model and show that the frequency of collaborative outcomes is lowest when the procurement manager has full control and highest when the engineer has full control or in a setup where employees can unilaterally enforce collaboration. A laboratory experiment confirms that collaborations occur more frequently when a manager with a long-term focus is in charge of or actively involved in decision making. Depending on how joint control is structured, joint control can help or hurt collaboration: Collaboration is highest when employees can unilaterally enforce it, whereas the random joint-control case results in collaboration that is as low as in the procurement manager control case. This paper was accepted by Serguei Netessine, operations management. Supplemental Material: The online appendix and data are available at https://doi.org/10.1287/mnsc.2021.4230 .

Organizations with Power-Hungry Agents

We analyze a model of hierarchies in organizations where neither decisions themselves nor the delegation of decisions are contractible, and where power-hungry agents derive a private benefit from making decisions. Two distinct agency problems arise and interact: Subordinates take more biased decisions (which favors adding more hierarchical layers), but uninformed superiors may fail to delegate (which favors removing layers). A designer may remove intermediate layers of the hierarchy (eliminate middle managers) or de-integrate an organization by removing top layers (eliminate top managers). We show that stronger preferences for power result in smaller, more de-integrated hierarchies. Our key insight is that hoarding of decision rights is especially severe at the top of the hierarchy.

Organizational Structure for the IT Department: Profit Center or Cost Center?

Why do some firms organize their IT departments as profit centers whereas other firms organize IT as a cost center? These commonly employed organizational structures are characterized by information asymmetry and decision rights afforded to the IT department. The complexity of IT and its ongoing rapid evolution lead to information asymmetry where the IT department has private information about technology and cost, and the consuming departments have private information about demand. Under the cost center organizational structure, the firm sets the quality and number of IT services offered by the IT department. Whereas under a profit center structure, the IT department makes decisions on quality, price and variety of IT services. We find that the quality of IT services under the cost center decreases with greater uncertainty in demand for IT services. We also find that the cost center structure can offer higher quality IT services than the profit center structure, and consumption of IT services can be higher under the profit center structure. The preferred organizational structure does not always provide greater variety of IT services than the alternate structure. The cost center is preferred when the marginal cost of IT services is sufficiently low, or the fixed cost of quality is sufficiently high.

Tribal Property Rights: A Legal Analysis

In our country, the property rights of tribals are in extreme jeopardy. Despite various legislations and laws that ensure that property rights to the tribals are not denied, the situation is dire. There is also a massive power imbalance; the tribes have no power against the states and are always the victims. A constitutional provision like the Fifth Schedule is highly outdated and centralizes the decision-making rights of tribals. The PESA Act established to ensure that tribals are more involved in decision-making has been manipulated and not appropriately implemented. The LARR Act and the FRA Act, dealing with land acquisition laws and tribal property rights, respectively, have successfully been diluted by the states as well the central government.

Online content platforms, copyright decision-making algorithms and fundamental rights protection in China

ABSTRACT Concentration of power in terms of user traffic and copyright content is most evident in content platforms in China. Such concentration has generated an unexpected impact on the way we understand and appreciate creativity, on copyright enforcement and determination of liability on content platforms, and on the regulation of the cultural market by the government. Specifically, the concentration of power in content platforms has not only curbed direct online piracies to a large extent but has also accelerated the fragmentation of copyright enforcement and spawned the need for algorithmic recommendation and filtering systems, which in turn has reinforced the cultural censorship system of China. This paper argues that the employment of algorithms by platforms must be treated with prudence: the algorithmic decision-making systems employed by platforms must be transparent as much as possible, and remedies must be provided for concerned users. The algorithms employed by content platforms must be adjusted to reflect not just the interests of the platforms but also the public interest in accessing and delivering information and local policy considerations. This paper suggests that our regulatory framework should reflect the algorithmic turn of content platforms in its legal and non-legal instruments and alleviate their negative impact on society.

Ethical Marketing Communication: Customers’ Decision Rights Protection

This proposed quantitative research scenario studied on ethical marketing communication to protect the decision-making rights of customers. The research will consist of a survey and development research with Structural Equation Modelling (SEM). These research results indicate that ethical marketing communications customers have developed decision-making rights protections. The new approach can be operationalized that will accelerate the rate of purchasing decision behavior by protecting the decision rights of ethical marketing customers in the Kingdom of Thailand.

The structure of decision rights in international joint ventures: a property rights and transaction cost view

The structure of decision rights in international joint ventures: a property rights and transaction cost view

Delegation of Decision Rights and Inertia in Capital Reallocation

Delegation of Decision Rights and Inertia in Capital Reallocation

A participatory approach for empowering community engagement in data governance: The Monash Net Zero Precinct

Abstract Data governance is an emerging field of study concerned with how a range of actors can successfully manage data assets according to rules of engagement, decision rights, and accountabilities. Urban studies scholarship has continued to demonstrate and criticize lack of community engagement in smart city development and urban data governance projects, including in local sustainability initiatives. However, few move beyond critique to unpack in more detail what community engagement should look like. To overcome this gap, we develop and test a participatory methodology to identify approaches to empowering community engagement in data governance in the context of the Monash Net Zero Precinct in Melbourne, Australia. Our approach uses design for social innovation to enable a small group of “precinct citizens” to co-design prototypes and multicriteria mapping as a participatory appraisal method to open up and reveal a diversity of perspectives and uncertainties on data governance approaches. The findings reveal the importance of creating deliberative spaces for pluralising community engagement in data governance that consider the diverse values and interests of precinct citizens. This research points toward new ways to conceptualize and design enabling processes of community engagement in data governance and reflects on implementation strategies attuned to the politics of participation to support the embedding of these innovations within specific socio-institutional contexts.

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