Delineating the corporate elite: Inquiring the boundaries and composition of interlocking directorate networks

Abstract

Corporate elite studies have for long investigated networks of interlocking directorates to test and corroborate key theoretical expectations regarding the cohesive organization of such an elite and their ability and willingness to act on behalf of general business interests. These studies typically collect data on a list of 50, 100, 200 or 500 corporations ranked by economic size, sometimes stratified in sectors. The sampling approach often follows previous studies in order to increase comparability. These relatively arbitrary sampling practices are problematic because they impact the empirical results and our therefore the conclusions drawn from it. Using a sample of 3251 Canada-based corporations, we establish that indeed different sampling criteria – that is sample size, proportion of financial firms, inclusion of state-owned enterprises and so on – significantly impacts network properties of corporate elite networks. We establish rather disturbing differences, especially for smaller sample sizes (<100). Subsequently, we develop alternative demarcation criteria of the corporate elite based on a k-core decomposition. We conclude by emphasizing that the sampling decisions in interlocking directorate studies should much more be carefully be thought through in future research on the topic, both in corporate elite studies and beyond.