Spanish Governance Research Articles

Urban governance in Spain: From democratic transition to austerity policies

This article aims to explain the evolution of urban governance in Spain during the last 40 years as a product of different waves of state rescaling. Historical, political and economic specificities shape the evolution of Spanish urban governance, especially because of the recent process of democratic transition, regional decentralisation and the specific process of de-industrialisation. We distinguish three periods in urban governance trends, from the restoration of democracy in the late 1970s to the current austerity urbanism marked by the economic crisis starting in 2008. For each phase, we highlight the three interrelated factors explaining urban governance: (1) the evolution of the Spanish political economy in the transition from Fordism to post-Fordism; (2) the evolution of the welfare state; and (3) the role of urban social movements.

The Evolution of Spanish Governance during the Early Bourbon Period in Peru: The Juan Santos Atahualpa Rebellion and the Missionaries of Ocopa

In 1742, a highland Andean named Juan Santos led a group of mainly Asháninka and Yanesha warriors against a handful of isolated Franciscan missions in the central high jungle of Peru. Over the next ten years the rebellion smoldered, occasionally sparking to life, as Santos's forces pushed the missionaries based out of the College of Santa Rosa de Ocopa (near Jauja, Peru) back to the highlands. The uprising culminated in a brief foray into the highlands, but never effectively reached beyond the security of the densely vegetated high jungle, known locally as the centralmontañaregion. Despite its modest accomplishments, the rebellion secured autonomy for the combatant nations during the rest of the colonial period.

Intercultural policy and multi-level governance in Barcelona: mainstreaming comprehensive approach

The main purpose of this article is to analyse Barcelona’s mainstreaming approach to intercultural policy from the beginning of its immigration process. My key questions are threefold: (a) why was Barcelona attracted by the intercultural approach so early in 1997? (b) how can we understand the consolidation of interculturalism? and (c) how can its successful permanent endurance (16 years) be explained, given different migratory contexts/political governments? I will argue that Barcelona’s status as a key player within the multi-level system of Catalan and Spanish governance has been a favourable key factor. I will first feature the mainstreaming approach, and then defend the argument that the vertical dimension has helped to strengthen the legitimacy of the horizontal dimension, as it has provided a favourable environment in which interculturalism can flourish. I conclude by highlighting the fact that the analysis of Barcelona helps to provide new meanings for the multi-level governance debate in diverse European cities. Points for practitioners Multi-level governance and cities networks influence the policy design and the consolidation of cities’ diversity policies. There is an assumed link for cities between intercultural policies and the mainstreaming approach in diversity policies. The relationship between the vertical and horizontal dimensions of multi-level governance plays a key role in promoting a favourable environment for these policies to thrive.

La gouvernance territoriale espagnole à l’épreuve de la crise économique : vers la recentralisation ?

Has the economic crisis modified the political equilibria of Spanish territorial governance? Everything seems to suggest that this system is experiencing two forms of stress: centripetal and centrifugal. The centripetal dynamic is driven by the public debt and the necessity with which the central state is confronted to retake control of regional public finances. The centrifugal dynamic, for its part, is reflected in a refusal on the part of some regional executives – first and foremost, those of the Catalan government – to cooperate with this silent recentralization. On the contrary, they demand greater financial autonomy, which may lead to de facto independence. Spain is therefore a state generally tending towards federalism but in which the conjunction of political equilibria (national and regional) and the ups and downs of the economy have provoked major instability. In this respect, the upcoming elections will offer a key moment for understanding the evolution of the politico-territorial system. More than ever, the state of autonomies finds itself at a crossroads. ■

Frank Marotti. Heaven's Soldiers: Free People of Color and the Spanish Legacy in Antebellum Florida.

Frank Marotti's Heaven's Soldiers: Free People of Color and the Spanish Legacy in Antebellum Florida is a multifaceted study of free blacks in a slave society undergoing the transition from Spanish governance to the rule of the United States. During the Spanish period free people of African descent enjoyed legal protections and a modicum of public engagement, especially if they descended from white planter parentage. As Marotti and others have pointed out, when the United States gained control of the Florida colonies and organized them as a territory, many of the formal and informal practices toward free blacks were renegotiated. What Marotti adds to this story is the active role free blacks played in these negotiations; and this contribution is an important one. Few scholars have examined the ways in which notions of rights or even citizenship move out of the confines of legal history to explore the ways people on the street participated in shaping the laws and policies that guided their daily lives.

Rescaling of Resource Governance as Institutional Change: Explaining the Transformation of Water Governance in Southern Spain

ABSTRACTThis paper develops a conceptual framework highlighting the functional and constitutional (two‐level) negotiation aspects of water governance rescaling, illustrated by the case of southern Spanish water governance reorganization for the Guadalquivir River Basin. The framework is derived from theories of institutional change and multi‐level governance. A necessary precondition for rescaling is changes in actor‐specific perceptions concerning how to best address priorities of water management through water governance. Predominant in rescaling is its coincidence with a contingent political majority of these actors enabling agreement on changes in governance conforming to existing constitutional rules for negotiation. Ultimately, in southern Spain, the constitutional setting prevented re‐scaling. It had initially been promoted by regional actors benefitting from a contingent political majority at the federal as well as at the state level. The paper highlights that, in the context of transformations of European water governance, in Spain supranational policy‐making is of low significance domestically. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment

GOBIERNO, AUTONOMÍA Y TOMA DE DECISIONES EN LA UNIVERSIDAD

INTRODUCTION. European countries have undertaken reforms of their higher education systems that have affected the governance structures of universities. These reforms have been guided largely by the agendas set by the Bologna Process and the Lisbon Strategy. METHOD. We analyze the documentation produced by the European Commission on the reform of higher education systems in Europe and examine it in light of the current theoretical interpretation of the theme of governance, autonomy and decision-making in universities. RESULTS. Similar trends are observed in European countries that possess common structures and similar boards, but there are major differences in their members, origin, election process, accountability mechanisms, etc. However, in the same system of higher education, different universities respond in varying ways to the demands of society. In Spain, the state government has not addressed a profound reform of university governance in line with the recommended changes, although it has been widely debated by experts who have reached similar conclusions. DISCUSSION. Although these debates have not been translated into legislative reforms, universities are advancing, some of them in the right direction. Therefore, a possible strategy to tackle Spanish university governance is to analyze how universities are accountable for their decisions and allow them to organize themselves in an autonomous way, as they are already doing in what we call the informal universe.

Does board member stock ownership influence the effect of board composition on innovation?

This study analyses the influence of board composition on companies’ innovation in the Spanish corporate governance system. Drawing from a multi-theoretical perspective, the analysis shows the moderating effect of board member stock ownership on the relationship between board composition and innovation. Using secondary data from a sample of Spanish-quoted companies in technology industries over the 2003–2005 period, the findings demonstrate that board composition influences the innovative behaviour of firms, and that this influence is also conditioned by directors’ stock ownership because directors’ attitude towards innovation could vary depending on their power and on how many shares they own. These results confirm that innovation increases in firms whose boards have a high proportion of affiliated directors with significant stock ownership. This study also makes some important contributions towards creating a more effective board that can shape companies’ strategic orientation, highlighting the need to consider the joint impact of board composition and ownership concentration.

Environmental Jolts, Board Governance Practices and Firm Value: Evidence from the 2008 Financial Crisis

Environmental jolts are temporary disruptions that cause a hostile transformation in the level of resources available in a given system. Using the 2008 financial crisis as a moderator factor in the relationship between board structure and firm value, we assess if there is any change in board governance practices as a result of firms adaptation to the changes caused by the jolt. Our data is composed by 101 Spanish publicly traded firms for the period between 2003 and 2010. The Spanish governance system shares many characteristics with the systems holding in other Western European countries. Therefore this study contributes to the literature on governance practices and its impact on firm performance in Europe. We use dynamic panel data methodology and instruments to control for the problems of endogeneity and heteroskedasticity. Our results show that boards do change to adapt to this new reality where resources are scarce and growth opportunities are scant. During the crisis period, the optimal board size increases by two members, the presence of independent directors prevent firms from increasing financial leverage and managers get entrenched at higher levels of board ownership. This study has useful implications for practitioners as it shows the positive impact of the adoption of best board governance practices on firm value in times of munificence and during environmental jolts.

Spanish maritime security governance in the Indian Ocean Region

International maritime security issues are high on the agenda of many states and international organisations. Assaults in international waters on vessels flying the Spanish flag raised the awareness of piracy and other illicit acts at sea. Spain applies a twofold strategy in order to fight against piracy off the Somali coast and in the Indian Ocean: it takes part in the first maritime operation of the European Union (EU), EU NAVFOR Atalanta, and facilitates the deployment of private security companies (PSCs) on board civilian vessels sailing in international waters. Based on the security governance concept, this paper examines and compares the strategies regarding actors, the decision-making processes, legal issues and effectiveness. The article argues that the main reason for the change in security policy is that the actors involved assume a security governance approach to be more effective in solving a specific security problem.

Revisiting corporate governance through the lens of the Spanish evidence

The purpose of this study is to illustrate the characteristics of the Spanish corporate governance system and especially describe the diffusion of each mechanism among listed firms, in comparison with other industrialized countries. In doing so, we identify idiosyncratic traits of the Spanish corporate governance model that points up how the dichotomy between outsider- and insider-oriented models is simplistic and does not fit with the Spanish context. We argue, instead, that corporate governance has evolved in Spain towards a hybrid model that is situated in an intermediate position between the two aforementioned systems. The result of this hybridization is a system characterized by a new role for the state as a regulator, the presence of large blockholders, and a higher free float of capital on the stock market. Still, it is a very weak market for corporate control, and has reduced incorporation of Anglo-Saxon practices such as information transparency, board independence, or variable compensation packages for the management.

Proprietary costs, governance and the segment disclosure decision

Focusing on the Spanish setting, characterized by high ownership concentration and a regulatory framework that traditionally has given more priority to the avoidance of proprietary and competition costs related to disclosure than to promoting transparency, this paper aims to identify the main factors influencing the segment reporting decision. In particular, we aim to test whether the strength of concentrated ownership structures together with the persistence of the pre-IAS reporting philosophy offsets the role of independent directors. If this is the case, it would be in spite of the new IAS/IFRS reporting standards based on relevance and transparency, and would also run counter to the improvements in the Spanish governance framework which strengthens the presence of independent non-executive directors. The empirical evidence suggests that, under the new IAS/IFRS reporting philosophy, proprietary costs may have lost relevance due to the introduction of mandatory segment information requirements. In addition, within an institutional context of high ownership concentration, independent directors play a significant role in raising the level of reported information. The context of the new IFRS 8 offers opportunities to observe how governance and proprietary costs affect the new ‘management approach’ to segment classification.

Proprietary Costs & Governance on the Segment Disclosure Decision

Focusing on the Spanish setting, traditionally characterized by high ownership concentration and a regulatory framework which has traditionally given more priority to the avoidance of proprietary and competition costs related to segment disclosures than promoting transparency, this paper aims to identify the main factors influencing the segment reporting decision. In particular, we aim to test whether the strength of the concentrated ownership structures together with the remaining pre-IAS reporting philosophy offsets the role of independent directors. If this is the case, it would be in spite of the new IAS/IFRS reporting standards based on relevance and transparency, and would also run counter to the improvements in the Spanish governance framework which strengthens the presence of independent non-executive directors. The empirical evidence suggests that under the new IAS/IFRS reporting philosophy, proprietary costs may have lost relevance due to the introduction of mandatory segment information requirements. In addition, within an institutional context of high ownership concentration independent directors play a significant role in raising the level of reported information. The context of the new IFRS 8 offers new opportunities to observe how governance and proprietary costs affect the new “management approach” for segment reporting classification.

Contesting the Word: The Crown and the Printing Press in Colonial Spanish America

This article has two principal objectives. Firstly, it seeks to offer an overview of printed works in sixteenth-century Mexico, including a discussion of a variety of religious and didactic texts, as well as an account of the intellectual vigour reflected in the publication of scientific, juridical, philosophical, and historical writings, and even printed ephemera. Secondly, it seeks to identify the socio-political factors that shaped the history of the Western book in Spanish America, paying particular attention to the Crown's conflicts with the Franciscan order and the Spanish settlers. The article argues that while the printing press was instrumental for the Spanish Crown's governance of its Spanish and Amerindian subjects, this new information technology also presented potential challenges to Royal sovereignty, which elicited censorship.

The Wealth Effects Of Managerial Turnover: Implications For The Spanish Corporate Governance System

Managerial succession decisions constitute crucial events for the company, as they can generate important organizational changes that affect the shareholders wealth, and at the same time, entail important conflicts of interests between the managers and the shareholders. Our study of the market reactions to managerial turnover announcements in the Spanish market, reveal that these decisions have a positive effect on the shareholders wealth. These wealth effects are especially intense in the case of outsider successions and when the company preturnover performance has been poor. These findings suggest that managerial turnover is a restructuring decision that is most welcome under conditions of low performance. These results are reinforced by the existence of a negative relationship between the turnover wealth effects and the firm's preturnover performance. Our results also have implications regarding the effectiveness of the Spanish corporate governance system, suggesting that the Board's outsiders and the institutional shareholders play a major monitoring role in the managerial succession processes. The Board outsiders and the institutional shareholders influence the succession process protecting the shareholders interests against particular professional interests of the managers. We have also found evidences of the existence of entrenchment effects linked to managerial stock ownership. Finally, consistently with our event study results, we have found evidences of a positive effect of outside succession on the market's reaction to managerial turnover, in the case of a poor presuccession performance context. We have obtained no evidence about any effect from outside succession in good performing companies or inside succession in any company independently of its previous performance.

Ownership structure and forecast accuracy in Spain

This article examines how analysts respond to specific ownership structure characteristics by studying the accuracy of their forecasts after the release of the first Spanish corporate governance code and before IFRS were adopted. Specifically, we analyse the influence of ownership concentration, bank ownership and insider ownership on analyst forecast errors. Overall the results show a positive and significant influence of bank ownership on analyst forecast accuracy, which suggests that bank ownership leads to closer monitoring of management and a reduction in analyst forecast errors. However, the presence of large shareholders and insiders in the ownership structure of the firm does not significantly affect the accuracy of financial analysts. This research provides investors with a more refined sense of how analyst forecasts might be affected through the composition of the ownership structure in a context of high concentration of ownership, relevant presence of banks in firms as creditors and shareholders, and local GAAP.

The effects of boards of directors on R&D investments: the case of Spain

This paper analyses how the composition and ownership structure of boards of directors affect firms' R&D investments. Most research on the impact of the board focuses on corporate performance in an Anglo-American context. This study explores the influence of the board on R&D investments in the Spanish corporate governance system, which is different from the British and US systems. Data from 86 Spanish quoted companies in technology industries show that board composition influences R&D investments. Further, our results indicate that ownership structure can moderate the relation between board composition and R&D investments. This study states opposing hypotheses, based on arguments from agency and stewardship theories. We use these theories to analyse the influence of the board on R&D investments as a key factor for success in highly competitive technology industries.

Need and Function for Independent Directors - Difficulties for Their Transplant to Spanish Listed Corporations (In Spanish)

Independent directors as a corporate governance institution have Anglo-Saxon origins and were 'imported' to Spanish regulation of listed corporations by good governance codes. Ten years ago, the Olivencia Code recommended the appointment of independent directors to their boards. Currently, this is one of the pillar recommendations around which the Spanish corporate governance system is built-as regulated by the Unified Code of Good Governance (2007). Notwithstanding the fact that this institution and its implantation in Spanish listed corporations have triggered significant interest, legal studies have so far not completely settled the numerous issues that the transplant of the figure of independent directors into the Spanish legal system raises. The problems and difficulties that independent directors generate in other legal orders pile up with the specific frictions of their inclusion in Spanish boards of directors. This paper focuses on the need and function of independent directors in the Spanish legal regime of listed companies.

Contagion effect of the Sarbanes–Oxley Act: Evidence from Spain

This study provides an overview of Spanish regulators’ efforts to strengthen disclosure and governance regulations in capital markets. Disclosure and corporate governance became an increasingly important issue, particularly after the recent wave of corporate scandals and the enactment of the Sarbanes–Oxley Act in 2002. In the post-Sarbanes–Oxley Act era, regulators around the world took different paths to combat scandals and heal the damage corporate scandals incurred on investors’ confidence. This study analyses the path that Spanish regulators took to deal with disclosure and corporate governance concerns and compares and contrasts the Spanish efforts to the Sarbanes–Oxley Act in terms of content and enforcement. As a result of our analysis, we find the Sarbanes–Oxley Act's impact on Spanish regulations to be significant. Substantial effort on behalf of Spanish regulators was put to increase disclosure and governance standards in Spain. Nevertheless, Spanish regulators’ efforts often lacked the enforcement that was established in the US. Spain's growing importance in world markets and its unique approach to dealing with corporate governance issues makes the analysis of Spanish efforts to enhance corporate governance standards highly relevant to a wide audience, which includes but is not confined to (1) executives and managers of global companies that do or seek business in Spain, (2) researchers working in the field of disclosure and corporate governance, (3) regulators concerned with meeting investors’ growing demands for higher disclosure and corporate governance standards, (4) attorneys focused on Spanish corporate governance law, (5) international investors assessing investment opportunities in Spain, and (6) stock exchange officials considering cooperation with Spanish stock exchanges. Last but not least, this paper complements a series of previous papers published in this journal that focus on corporate governance in various countries. With this paper we hope to add on to the efforts of International Journal of Disclosure and Governance to give a full view of new regulations on disclosure and corporate governance around the world.

Managerial dominance and audit committee independence in Spanish corporate governance

The purpose of this paper is to analyse whether the independence of audit committees is affected by the degree of control exerted by managers over the board of directors. Results from a sample of 75 listed Spanish companies show that the majority of firms that voluntarily adopted an audit committee between 1998 and 2001, made an effort to guarantee their independence from management. The degree of independence is shown to be determined by the proportion of inside directors on the board, the same person holding both the CEO and board chairperson positions, and the level of management ownership. These findings may have political implications because existing regulations do not limit the presence of inside directors on audit committees. The presence of inside directors may compromise effectiveness, turning audit committees into instruments of management to provide the appearance of monitoring.