Abstract:
Over the last decade, corporate governance researchers have produced a significant number of studies dealing with a broad range of issues facing corporations. However, the majority of these studies have focused on developed countries, particularly the United States. Less work has been done on transition economies. Responding to this gap in corporate governance research, this thesis conducts research on a transition economy – Vietnam. In 1986, Vietnam began to develop market mechanisms through economic stabilisation, trade liberalisation, and the encouragement of private initiatives. The country utilised privatisation as a mechanism for economic development. Several state-owned-enterprises were privatised due to their welldocumented poor performance. The post-privatisation period in the country provides a specific setting for understanding the nature of principal-principal conflicts and extending the existing literature of this phenomenon. The research reported in this thesis consisted of a qualitative empirical study including 31 interviews with a wide range of stakeholders including CEOs, directors, supervisors, state officials and business professionals. In addition, internal organisational and public documents were collected and analysed to gain a deeper understanding of the phenomenon of principal-principal conflicts in Vietnam. My findings show that the new ownership structures of privatised companies involved different types of shareholders who were attached to different institutional logics. Moreover, concentrated ownership and the varied institutional logics embedded in organisations were found to lead to principal-principal conflicts. Different shareholders had different interests and incentives toward privatised companies, which led to four types of principal-principal conflicts. Controlling shareholders are more likely to expropriate minority shareholders’ interests in a country characterised by authoritarian rule and a weak legal system.