Abstract
The current debate on corporate governance can be characterised as a search for the perfect model. The academic discourse is polarised either on the shareholder paradigm, where the primary focus is on maximisation of shareholder wealth, or on the stakeholder paradigm, where a broader set of issues are presented as pertinent to best practice corporate governance. In the practitioner discourse, the debate is fundamentally focused on practical mechanisms to discipline directors and other actors where the emphasis is on developing regulation either in the form of law or codes. We argue that both discourses rely on a homeostatic view of the corporation and its governance structures. Further, we argue that both discourses pay inadequate attention to the underlying philosophical presuppositions resulting in a static approach to the understanding of corporate governance. We present an alternative, a processual approach, as a means of avoiding the traditional trap in corporate governance theorising. Using this approach, we argue that a collibrated mechanism is more likely to emerge and consequently a better understanding of the heterogeneity of corporate governance practice will follow, providing deeper insight into the fluxing nature of corporate bodies and their governance structures.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
This paper extends work previously presented at the Academy of Management 2006 and 2007 conferences.
References
Alchian, A.A., and H. Demsetz. 1972. Production, information costs, and economic organization. American Economic Review 62: 777–795.
Ancona, D.G., G.A. Okhuysen, and L.A. Perlow. 2001. Taking time to integrate temporal research. Academy of Management Review 26: 512–529.
Arthur, E.E. 1987. The ethics of corporate governance. Journal of Business Ethics 6: 59–70.
Barker, E. 1950. Introduction. In Natural law and the theory of society 1500 to 1800, ed. O.F. von Gierke, ix–xci. Cambridge: Cambridge University Press.
Berger, P.L., and T. Luckmann. 1966. The social construction of reality: A treatise in the sociology of knowledge. Garden City, NY: Doubleday.
Bergson, H. 1903. An introduction to metaphysics. London: Macmillan.
Berle, A.A., and G.C. Means. 1932. The modern corporation and private property. New York, NY: Macmillan.
Bhojraj, S., and P. Sengupta. 2003. Effect of corporate governance on bond ratings and yields: The role of institutional investors and outside directors. Journal of Business 76: 455–475.
Bishop, M. 1994. Watching the boss. The Economist, 29 January 1994: 3–5.
Blair, M.M. 1995. Ownership and control: Rethinking corporate governance for the twenty-first century. Washington, DC: Brookings Institution.
Boden, D. 1990. The world as it happens: Ethnomethodology and conversation analysis. In Frontiers of social theory: A new synthesis, ed. G. Ritzer, 185–213. New York: Columbia University Press.
Bourdieu, P. 1984. Distinction: A social critique of the judgement of taste. London: Routledge.
Burchell, G., C. Gordon, and P. Miller. 1991. Preface. In The Foucault effect: Studies in governmentality, ed. G. Burchell, C. Gordon, and P. Miller, ix–x. Hemel Hempstead: Harvester Wheatsheaf.
Carter, C.B., and J.W. Lorsch. 2004. Back to the drawing board: Designing corporate boards for a complex world. Cambridge, MA: Harvard Business School Press.
Charkham, J. 1994. Keeping good company: A study of corporate governance in five countries. Oxford: Clarendon.
Clegg, S.R. 1989. Radical revisions: Power, discipline and organizations. Organization Studies 10: 97–115.
Eisenhardt, K.M. 1989. Agency theory: An assessment and review. Academy of Management Review 14: 57–74.
Fligstein, N. 1990. The transformation of corporate control. Cambridge, MA: Harvard University Press.
Foucault, M. 1974. The order of things. London: Tavistock.
Foucault, M. 1979/1988. Politics and reason. In Michel Foucault: Politics, philosophy, culture. interviews and other writings 1977–1984, ed. L.D. Kritzman, 57–85. London: Routledge.
Frankl, V.E. 1959. Man’s search for meaning. Boston, MA: Beacon Press.
Freeman, R.E. 1984. Strategic management: A stakeholder approach. Boston, MA: Pitman.
Hart, O. 1995. Corporate governance: Some theory and implications. The Economic Journal 105: 678–689.
Hartshorne, C. 1984. Whitehead as central but not sole process philosopher. In Whitehead und der Prozessbegriff (Whitehead and the Idea of Process), ed. H. Holz and E. Wolf-Gazo, 34–38. Freiburg, Munich: Verlag Karl Alber.
Hawley, J.P., and A.T. Williams. 1996. Corporate governance in the United States: The rise of fiduciary capitalism – A review of the literature. Working Paper, Saint Mary’s College of California, School of Economics and Business Administration.
Hayek, F.A. von. 1982. Law, legislation and liberty. London: Routledge & Kegan Paul.
Hayes, R.H., and W.J. Abernathy. 1980. Managing our way to economic decline. Harvard Business Review, July–August, 67–77.
Herman, E.S., and L. Lowenstein. 1988. Efficiency effects of hostile takeovers. In Knights, raiders and targets: The impact of the hostile takeover, ed. J.C. Coffee, L. Lowenstein, and S. Rose-Ackerman, 211–240. New York, NY: Oxford University Press.
Hutton, W. 1995. The state we’re in. London: Jonathan Cape.
James, W. 1909. A pluralistic universe. Lincoln, NE: University of Nebraska Press.
James, W. 1911. Some problems of philosophy. Lincoln, NE: University of Nebraska Press.
Jensen, M.C. 1993. The modern industrial revolution, exit, and the failure of internal control systems. Journal of Finance 48: 831–880.
Jensen, M.C., and W.H. Meckling. 1976. Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics 3: 305–360.
Jungerman, J.A. 2000. World in process: Creativity and interconnection in the new physics. Albany, NY: State University of New York Press.
Kay, J., and A. Silberston. 1995. Corporate governance. National Institute Economic Review 153: 84–107.
Keasey, K., S. Thompson, and M. Wright. 1997. Introduction: The corporate governance problem – Competing diagnoses and solutions. In Corporate governance: Economic and financial issues, ed. K. Keasey, S. Thompson, and M. Wright, 1–17. New York: Oxford University Press.
Keynes, J.M. 1936. The general theory of employment, interest and money. New York, NY: Harcourt, Brace.
Kirkbride, J., and S. Letza. 2004. Regulation, governance and regulatory collibration: Achieving an “holistic” approach. Corporate Governance 12: 85–92.
Latham, M. 1999. The corporate monitoring firm. Corporate Governance 7: 12–20.
Leblanc, R., and J. Gillies. 2005. Inside the boardroom: How boards really work and the coming revolution in corporate governance. Mississauga, Ontario: John Wiley & Sons Canada, Ltd.
Loasby, B.J. 1998. On the definition and organisation of capabilities. Revue Internationale de Systémique 12: 13–26.
Manne, H.G. 1965. Mergers and the market for corporate control. Journal of Political Economy 73: 110–120.
Mayson, S.W., D. French, and C.L. Ryan. 1994. Company law. London: Blackstone Press.
McNulty, T., J. Roberts, and P. Stiles. 2005. Undertaking governance reform and research: Further reflections on the Higgs review. British Journal of Management 16: S99–S107.
Moerland, P.W. 1995. Alternative disciplinary mechanisms in different corporate systems. Journal of Economic Behavior and Organization 26: 17–34.
Mohr, L.B. 1982. Explaining organizational behavior. San Francisco, CA: Jossey-Bass.
Morgan, G. 1997. Images of organization, 2nd ed. Thousand Oaks, CA: Sage.
Mueller, F. 1995. Organizational governance and employee cooperation: Can we learn from economists? Human Relations 48: 1217–1235.
Parkinson, J. 1995. The role of “exit” and “voice” in corporate governance. In Corporate governance and corporate control, ed. S. Sheikh and W. Rees, 75–110. London: Cavendish.
Poole, M.S., A.H. van de Ven, K. Dooley, and M.E. Holmes. 2000. Organizational change and innovation processes: Theory and methods for research. New York: Oxford University Press.
Porter, M.E. 1991. Towards a dynamic theory of strategy. Strategic Management Journal 12: 95–117.
Pound, J. 1993. The rise of the political model of corporate governance and corporate control. New York University Law Review 68: 1003–1071.
Rescher, N. 1988. Rationality: A philosophical inquiry into the nature and the rationale of reason. New York: Oxford University Press.
Rescher, N. 1996. Process metaphysics: An introduction to process philosophy. Albany, NY: State University of New York Press.
Roy, W.G. 1997. Socialising capital: The rise of the large industrial corporation in America. Princeton, NJ: Princeton University Press.
Sayer, A. 1984. Method in social science: A realist approach. London: Hutchinson.
Schatzki, T.R., K. Knorr Cetina, and E. von Savigny. eds. 2001. The practice turn in contemporary theory. London: Routledge.
Shiller, R.J. 1989. Do stock prices move too much to be justified by subsequent changes in dividends? In Market volatility, ed. R.J. Shiller, 105–130. Cambridge, MA: MIT Press.
Short, H., and K. Keasey. 1997. Institutional shareholders and corporate governance. In Corporate governance: Responsibilities, risks and remuneration, ed. K. Keasey and M. Wright, 23–60. Chichester: Wiley.
Solomon, R.C., and K.M. Higgins. 1997. A passion for wisdom. A very brief history of philosophy. New York, NY: OUP.
Sternberg, E. 1998. Corporate governance: Accountability in the marketplace. London: Institute of Economic Affairs.
Sykes, A. 1994. Proposals for internationally competitive corporate governance in Britain and America. Corporate Governance 2: 187–195.
Taylor, C. 1985. Philosophy and the human sciences. Cambridge: Cambridge University Press. (= Philosophical Papers, Vol. 2).
Tsoukas, H. 1992. The relativity of organizing: Its knowledge presuppositions and its pedagogical implications for comparative management. Journal of Management Education 16: 147–162.
Tsoukas, H. 1994. Socio-economic systems and organizational management: An institutional perspective on the socialist firm. Organization Studies 15: 21–45.
Tsoukas, H. 2001. Re-viewing organization. Human Relations 54: 7–12.
Tsoukas, H., and R. Chia. 2002. On organizational becoming: Rethinking organizational change. Organization Science 13: 567–582.
Van de Ven, A.H., and M.S. Poole. 2005. Alternative approaches for studying organizational change. Organization Studies 26: 1377–1404.
Vickers, G. 1984. The art of judgement. London: Harper & Row.
Weick, K.E. 1977. Enactment processes in organizations. In New directions in organizational behaviour, ed. B.M. Staw and G.R. Salancik, 267–300. Chicago, IL: Saint Clair.
Weick, K.E. 1979. The social psychology of organizing, 2nd ed. New York, NY: McGraw-Hill.
Whitehead, A.N. 1929/1978. Process and reality: An essay in cosmology. Corrected edition D.R. Griffin and D.W. Sherburne. Cambridge: Cambridge University Press.
Whitehead, A.N. 1933/1961. Adventures of ideas. Harmondsworth: Penguin.
Williamson, O.E. 1975. Markets and hierarchies: Analysis and antitrust implications. New York, NY: Free Press.
Acknowledgements
The author is grateful for comments made by reviewers and those in attendance at the conferences.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2011 Springer Science+Business Media B.V.
About this chapter
Cite this chapter
Letza, S., Smallman, C., Sun, X., Kirkbride, J. (2011). Philosophical Underpinnings to Corporate Governance: A Collibrational Approach. In: Brink, A. (eds) Corporate Governance and Business Ethics. Studies in Economic Ethics and Philosophy, vol 39. Springer, Dordrecht. https://doi.org/10.1007/978-94-007-1588-2_7
Download citation
DOI: https://doi.org/10.1007/978-94-007-1588-2_7
Published:
Publisher Name: Springer, Dordrecht
Print ISBN: 978-94-007-1587-5
Online ISBN: 978-94-007-1588-2
eBook Packages: Humanities, Social Sciences and LawPhilosophy and Religion (R0)