This paper focuses on the question as whether the shift in ownership model from fully state-owned enterprise (SOEs) to partially privatised state-owned enterprises has had any implications to the governance model that affects financial autonomy and the investment choices. Using institutional and path-dependency theory as background theories, the paper examines, if the perceptions based on the experiences of the top leadership of completely state-owned companies vary from that of mixed ownership models (hybrid type of ownership that involves state-ownership holding and outsider shareholding). This helps us to understand whether the shift in ownership model from fully governed to a mixed model had any implications to the governance mode. It also provides insights on the role of government intervention following the changes in ownership model.
State Ownership Control and Financial Autonomy in Investment Decision Making in SOEs and hybrid organization are crucial and growing topics in public management and other research disciplines. Financial autonomy and investment decision making cannot be realized effectively and efficiently without governance and management of SOEs. In India, the process of disinvestment resulted in accountability of SOEs to two groups of owners: Government as a majority shareholder and the minority shareholders. This mixed ownership model contrasts with the traditional, value engines of SOEs which are mostly driven by regulatory or policy considerations rather than financial return objectives (Locke & Duppati, 2012). The result is government being a different kind of shareholder/owner (Essen, Heugens, Otten & Oasterhout, 2012). Hence, the emergence of a more nuanced view of SOEs as hybrid organizations, in which the levels of ownership and control by the State can vary.
This research provides evidence and interpretation of accountability frameworks and top leadership perspectives on corporate governance, processes and performance. It will positively affect research on SOEs and help corporates to understand how organizations play key economic and developmental roles. This can also facilitate the study of how government-owned organizations can be more effective, yet not at the expense of efficiency. Effective mechanisms and good practices may contribute to better performance of SOEs. Findings may help politicians, administrations, board members, auditors, consultants, scholars and the media striving for improvements in SOEs around the world.
The study uses exploratory and survey approaches and employs quasi-experimental analysis for scrutinising the data. The study is based on questionnaire interviews conducted by the author on directors and executives of thirty top state operated enterprises in India. The study investigates fifteen fully State owned firms and fifteen hybrid organisations (mixed ownership organisations that have elements of State and private ownership). It provides an opportunity to understand the practice of State ownership and control from the perspective of top leadership (Cooke, 2003; Kowalski et al., 2013). This also provides insights for the national and international investor community and consulting firms about the functioning of Indian SOEs and the associated role of the State.
Governance and management of State-Owned Enterprises, corporate forms and agencies on loca
