Small states, international pressures, and interlocking directorates: the cases of Switzerland and the Netherlands

Interlocking directorate networks among business enterprises have increasingly come under pressure due to internationalization and deregulation of markets. We show that in the small and internationalized economies of Switzerland and the Netherlands extensive changes have taken place. However, considerable differences in the form and the extent of these changes exist between the two countries. We argue that only by investigating which actors change their behavior we can understand and interpret the reasons for changes in the network structure. Combining a review of the Dutch and Swiss corporate governance landscape with a network analysis of board interlocks, we show that the changes in corporate networks are strongly affected by individual corporate strategies. The changing role of financial institutions in particular explains much of the variance between the two countries. Increasing influence of market pressures through dispersed ownership, on the contrary, does not explain changing patterns of interlocking directorates.