Crying over Spilt Parmalat

In the war of values between America and much of the world, corporate governance plays a big role. Different visions of how capitalism is run both reflect and in some cases fuel resentment of the US. In the 1990's, it looked as if the rest of the world wanted to do business the American way, with active capital markets and company bosses responding to shareholder interests. This Americanization was often described simply as "globalization."

Then came a backlash, fuelled in large part by the Enron debacle and other corporate scandals. Much of the world began to turn away from the American way of doing business. Europeans and Asians claimed with renewed vigor that their capitalist model involved a greater commitment to long-term values and a long-term vision. Shareholder value was dismissed as a fad and a fraud.

In continental Europe and parts of Asia, there has always been a vision of core business values centered on long-term institutions, especially the family. The extended family, indeed, remains central even in the large-enterprise sector. According to one recent calculation, 17 of the biggest 100 companies in Germany are in family hands, 26 in France, and 43 in Italy.

At the beginning of the 21st century, family interests reasserted themselves in continental Europe in a surprising way, ousting managers who seemed to have become too Americanized. In Germany, the Mohn family dismissed the lead manager of Bertelsmann, Thomas Middelhoff, who wanted to turn a family company into an almost denationalized enterprise. In France, Jean-Marie Messier was deposed from Vivendi Universal for similar reasons, and the Lagardère dynasty tried to regain control. Unlike Messier, the Lagardères were seen as deeply French. President Jacque Chirac's wife, the Prime Minister, and five ministers attended the funeral of Jean-Luc Lagardère in 2003.