Case Study

DaimlerChrysler: Corporate governance dynamics in a global company

27 pages
November 2003
Reference: IMD-3-1273

The development of the corporate governance system of DaimlerChrysler is of special interest, because few companies made such an organizational leap to globalization in such a short period of time. At the time of the merger in 1998, Daimler-Benz AG was an export-oriented, predominantly German company, whereas Chrysler Corporation focused almost exclusively on the US market. The $36 billion merger to form DaimlerChrysler AG (DC) was massive by any standard. But what happened afterwards? This case gives a detailed overview of what took place in the five years after the announcement of the deal in 1998. The main purpose of this case is to outline the intricacies DC encountered in the process of merging American and European corporate governance features. DC had to design a governance system, which overcame national differences, regulatory divergence and reflected business developments. Although DC was based in Germany, it was operating globally and had to comply with many rules and regulations. How could DC set up a governance system, which offered on the one hand transparency and accountability while allowing top managers enough time to properly do their day-to-day job?

Keywords
Corporate Governance, Global Business, Risk Exposure, Automotive
Settings
Global
1998-2003
Type
Field Research
Copyright
© 2003
Available Languages
English
Related material
Teaching note
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