Title: The Swiss business elite (1980–2000): how the changing composition of the elite explains the decline of the Swiss company network
Abstract: Abstract Abstract In this paper we analyse the decline of the Swiss corporate network between 1980 and 2000. We address the theoretical and methodological challenge of this transformation by the use of a combination of network analysis and multiple correspondence analysis (MCA). Based on a sample of top managers of the 110 largest Swiss companies in 1980 and 2000 we show that, beyond an adjustment to structural pressure, an explanation of the decline of the network has to include the strategies of the fractions of the business elites. We reveal that three factors contribute crucially to the decline of the Swiss corporate network: the managerialization of industrial leaders, the marginalization of law degree holders and the influx of hardly connected foreign managers. Keywords: business elitescapitalismSwitzerlandfinancializationnetworksfield Acknowledgements This paper was realized as part of a research project on the Swiss elite during the twentieth century financed by the Swiss National Science Foundation (grant no. 100012–113550/1). Previous versions were presented at conferences in Lausanne, Rotterdam and Manchester. We would like to thank the participants in these conferences, particularly Manuel Fischer, Johs Hjellbrekke, Claire Lemercier, Brigitte Le Roux, René Levy, Raffaele Poli, Gerhard Schnyder, Karel Williams, Paul Windolf, and the anonymous reviewers of Economy and Society for their stimulating comments. We would also like to thank Stéphanie Ginalski, Steven Piguet, Andrea Pilotti, Claudio Ravasi and Frédéric Rebmann for very helpful research assistance. Notes 1. The term 'fraction', as employed here and throughout this paper, corresponds to the French 'fraction' as it is often used by Bourdieu. In general, the English versions of Bourdieu's work also translate it in this way (see, for example, Bourdieu, 1996 Bourdieu, P. 1996. The state nobility, Cambridge: Polity Press. [Crossref] , [Google Scholar]). In his work Bourdieu uses the terms 'class' and 'class fraction', the latter corresponding to a sub-group of class. In a similar way, we employ the terms 'elite' and 'elite fraction'. In our use of the term we adopt the Bourdieusian definition. For Bourdieu, situating himself between a nominalistic and a realistic approach, classes or class fractions share a certain number of characteristics in the social space. This does not necessarily mean that they constitute 'real groups' (self-aware, organized, with a spokesperson, etc.). On the other hand, these classes or fractions have a higher probability of becoming organized and constituted as groups. This depends on a series of conditions, such as their homogeneity and their proximity in the social space (Bourdieu, 1984 Bourdieu, P. 1984. Espace social et genèse des 'classes'. Actes de la recherche en sciences sociales, 52–3: 3–14. [Crossref] , [Google Scholar]). Correspondingly, certain of the elite fractions we will examine are more homogeneous and self-conscious than others. However, we do not always have enough empirical material to allow discussion of the self-awareness of these groups or the conflicts among them. 2. In particular, historical network analysis has recently made important advances (see, for example, Vedres & Stark, 2010 Vedres, B. and Stark, D. 2010. Structural folds: Generative disruption in overlapping groups. American Journal of Sociology, 115: 1150–90. [Crossref], [Web of Science ®] , [Google Scholar]). Unfortunately, with our data, we are not yet able to understand these network transformations as a process. When it comes to MCA, very few historical comparisons have been made yet (Bourdieu, 1996 Bourdieu, P. 1996. The state nobility, Cambridge: Polity Press. [Crossref] , [Google Scholar]). 3. Oddly, the method at the heart of Bourdieu's work never found a wider echo in the Anglo-American research about elites. We can think of three reasons for this: 1) 'Le Patronat' (1978) has never been translated into English and The State Nobility (1996) has rarely been perceived as a piece of elite sociology; 2) De Saint Martin and Bourdieu refused to use the term 'elite' because in their view the notion was analytically tarnished as the self-attribution of the dominant as the 'elected group'; 3) MCA, even on a more general level, struggled to impose itself in American and British sociology. 4. Translated by the authors. 5. For a broad albeit heterogeneous collection of critical voices, see, for example, the special issue of 'Histoire et mesure', 12(3), 1997. 6. Interactions between actors that are not 'structurally homologues' are particularly likely in competitive spaces, such as the economic space. On the other hand, it is likely that structurally close actors, for example, two large banks, have only a few strategic interactions with each other because they are direct competitors. 7. See De Saint Martin & Bourdieu (1978 De Saint Martin, M. and Bourdieu, P. 1978. Le patronat. Actes de la recherche en sciences sociales, 20–21: 3–82 [Google Scholar], pp. 30, 38). Here they examine interlocking directorates, albeit in a rather unsystematic way. 8. This project was conducted at the University of Lausanne by Andre Mach and Thomas David, funded by the Swiss National Science Foundation (grant no. 100012–113550/1). The data collection was carried out by Stéphanie Ginalski, Frédéric Rebmann, Claudio Ravasi, Andrea Pilotti and Steven Piguet. 9. The firms have been chosen on the basis of a combination of criteria of market capitalization and turn-over (Schnyder et al., 2005 Schnyder, G., Lüpold, M., Mach, A., and David, T. 2005. The rise and decline of the Swiss company network during the 20th century, Lausanne: Institut d'Etudes Politiques et Internationales. [Google Scholar]). 10. The mean degree is defined as the mean of the sum of degrees of all nodes in the network. 11. A more detailed comparison of the Swiss network of interlocking directorates in 1980 and 2000 is given in Appendix 1. 12. On the ideology of shareholder value, see Lazonick & O'Sullivan (2000 Lazonick, W. and O'Sullivan, M. 2000. Maximizing shareholder value: A new ideology for corporate governance. Economy and Society, 29: 13–35. [Taylor & Francis Online], [Web of Science ®] , [Google Scholar]). 13. The reason that we did not obtain 220 individuals in our sample is that some of the people accumulate mandates or are at the same time CEO and president of the board of the same firm. 14. Information about the social background of the actors, for example, their social class or the occupations of their parents, would have been extremely helpful for drawing an even more insightful picture. However, especially for Swiss business leaders (compared, for example, with political leaders), such data are very difficult to obtain systematically. 15. In order to prevent redundancies, the category 'universities abroad' is used only as a passive category, which does not contribute to the construction of the field. 16. We rely here on the following information: member of the national committee of a political party, member of parliament or member of a political executive organism. It is very likely that many more members of the economic elite are simple members of a party without being politically active. 17. According to the current official definition, extra-parliamentary commissions are organizations that assume tasks on behalf of executive authorities but are essentially composed of people who are not civil servants. 18. The term 'dominated' as we use it here stems from the French word 'dominé'. The translation of this notion is delicate, and alternatives such as 'minority' or 'less dominant' might be more adequate. As in the translation of Bourdieu's work (for example, Bourdieu, 1996 Bourdieu, P. 1996. The state nobility, Cambridge: Polity Press. [Crossref] , [Google Scholar]) but also in contributions from other scholars working within a field framework (Fligstein, 2001 Fligstein, N. 2001. The architecture of markets: An economic sociology of twenty-first-century capitalist societies, Princeton, NJ: Princeton University Press. [Crossref] , [Google Scholar]) 'dominated' is used, we continue to use the term in this paper. 19. It goes without saying that their heterogeneity is one more reason for their dominated status, which means it is unlikely that they are able to organize themselves as a challenging force when faced with the more homogeneous dominant fractions. 20. In the Swiss armed forces, all Swiss citizens who are declared suitable must serve a first period of seventeen weeks at the age of 20. Until the age of 35 (and if they rank higher, then even longer), they must serve regular periods of training up to four weeks per year. These periods of military training are both a meeting place for the business elite and a formative experience for many managers. 21. Even though only the contribution to the horizontal axis is above average, with respect to MBA, the second axis (i.e. the distinction between engineers and law degree holders) is also significant according to the t-test (value=2.7). In terms of proportion, whereas only six out of twenty-four law degree holders have an additional MBA, twelve out of seventeen engineers possess a supplementary MBA. 22. The properties 'member of an extra-parliamentary commission' and 'member of an interest group' being now situated in the lower right quadrant and therefore being more clearly associated with the finance fraction. 23. His solid and traditional roots in a technological culture, reflected in his engineering degree from ETHZ, are strategically completed by a business education, mostly in the form of an MBA. Not only did Kindle earn an MBA at a US university, his closeness to a liberal business orientation is reinforced by a four-year spell at McKinsey Associates. 24. At least in the year 2000, the top management of large Swiss banks is not yet 'internationalized'. Only in 2001 did the Briton Luqman Arnold became the first non-Swiss CEO to take the helm of a large bank (UBS). This suggests that the way for challengers towards the most dominant positions of the space of the Swiss elites is tortuous and time consuming. 25. It is important to note not only that the profile of foreign managers is very different, but also that the reasons for occupying a top position in a Swiss company can vary widely. We can distinguish between founders/shareholders, 'mountaineers' in Swiss companies, 'mountaineers' in merger and acquisition companies and internationalized managers. Additional informationNotes on contributorsFelix BühlmannFelix Bühlmann was trained in sociology and political science at the universities of Geneva, Berlin, Lausanne and Manchester. He is currently Head of Social Reporting at the Swiss Centre for Expertise in the Social Sciences (FORS) at the University of Lausanne, Switzerland. He has recently published in the European Sociological Review, Sociology and the Swiss Journal of Sociology. His current research interests include economic sociology, political sociology and sociology of the sciencesThomas DavidThomas David is Professor at the Faculty of Political and Social Sciences and director of the Institute of Economic and Social History at the University of Lausanne. Recently he has been working on issues such as elites in twentieth-century Switzerland, European corporate networks during the twentieth century, social inequalities and international relations in a historical perspective. He is the author of several books and has recently published in the World Political Science Review, Swiss Political Science Review and Business and PoliticsAndré MachAndré Mach is Senior Lecturer in Comparative Political Economy at the Institute of Political and International Studies (University of Lausanne). His areas of specialization include: comparative political economy, economic sociology, elites sociology, industrial relations, corporate governance, competition policy, interest groups, Swiss politics, impact of globalization on national politics and policies. He has recently published in Business and Politics, World Political Science Review, Swiss Political Science Review and Journal of European Public Policy
Publication Year: 2012
Publication Date: 2012-05-01
Language: en
Type: article
Indexed In: ['crossref']
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Cited By Count: 45
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