Full text - European Trade Union Institute (ETUI)

Employee representation in corporate governance: part of the economic or the social sphere?
1.4 Competing positions in the regulation of corporate
governance: synthesis of our analytical framework
The demonstration we have engaged in so far could be summarised as
follows. What is at stake in IR actors’ play on the regulation – and especially
the production of legal rules - of corporate governance is the confrontation
of two competing representations of the world: one conceiving the world
as composed of two distinct and disembedded spheres (the social and the
economic spheres); the other viewing the world as a single embedded sphere
encompassing both the social and economic dimensions. These competing
representations of the world are to be discerned in how IR actors incorporate
corporate governance matters in the legal domain, whether on the basis of a
strong division of labour between company law and labour law, or on the basis
of an interdependency of both legal fields. Table 2 presents a synthesis.
Table 2 Competing IR actors’ positions with regard to the regulation of corporate governance
Representation of the world
Nature of the linkage between
the Economic and the Social
Indicators
Nature of the linkage between
company law and labour law
Source: author’s design.
Position 1 Position 2
Economic / Social
=> separate spheres
Company law / Labour law
=> Separate fields of regulation
Economic & Social
=> Interdependent and embedded spheres
Company law & Labour law
=> Interdependent and embedded fields of regulation
We indeed consider the nature of the linkage between company law and
labour law in the corporate governance regulatory process as an indicator. We
will thus be able to infer each actor’s representation of the world depending on
its treatment of this linkage. IR actors who make a sharp distinction between
these two legal fields and treat their related production of rules independently
will therefore be considered to hold a representation of the world in which the
economic and the social spheres are disembedded, the former – the sphere of
economic, strategic and financial decision-making – being the sole prerogative
of the top management/shareholders duo, while the latter is referred to as
‘social dialogue’ between top management and workers on employment and
working conditions, such as wages. Conversely, IR actors demanding the
synchronisation of the production of rules in both company and labour law
on the basis that no decision can be made in one field without involving the
other, will be considered to hold a representation of the world in which both
the economic and the social spheres are embedded.
WP 2011.08 17