Corporate Governance Development in a Rapidly Changing Economy: Trends and Challenges in Estonia

Abstract

Implications of the Estonian privatization and the two-tier board model on corporate governance development are discussed. Despite implementing OECD corporate governance guidelines the stock market has still limited role in Estonian economy. The chapter reflects empirical research conducted at the Estonian Business School in the field of corporate governance at different stages of Estonian integration to the European Union and in the change management context. Technology-based new ventures create situations, where entrepreneurs are choosing new owners able to offer smart capital. These examples cannot be fully explained by applying the traditional principal-agent logic. Cases presented by participants of training workshops highlight conflicts between owners with different future vision and difficulties of entrepreneurs to differentiate the role of corporate governance from the daily management of business operations.