Details
Over the last two decades there has been a notable increase in the number of corporate governance codes and principles, as well as a range of improvements in structures and mechanisms. Despite this, corporate governance failed to prevent a widespread default of fiduciary duties of corporate boards and managerial responsibilities in the finance industry, which contributed to the 2007–10 global financial crisis. This 2011 book brings together leading scholars from North America, Europe, Asia-Pacific and the Middle East to provide fresh and critical analytical insights on the systemic failures of corporate governance linked to the global financial crisis. Contributors draw from a range of disciplines to demonstrate the severe limitations of the dominant corporate governance framework and its associated market-oriented approach. They provide suggestions on how the governance problems could be tackled to prevent or mitigate any future financial crisis and explore new directions for post-crisis corporate governance research and reforms.
• Provides a critical and international analysis of corporate governance covering fundamental issues and the implications of the recent financial crisis
• Multidisciplinary research allows readers to understand corporate governance from a number of different perspectives, including business and management, economics, law and political science
• Features contributions by internationally renowned experts from North America, Europe, the Asia-Pacific and the Middle East
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List of figures
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viii |
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List of tables
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ix |
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List of contributors
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x |
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Acknowledgements
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xiii |
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1 Introduction: rethinking corporate governance – lessons from the global financial crisis
William Sun, Jim Stewart and David Pollard
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1 |
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Part I The failure of the market approach to corporate governance
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23 |
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2 Corporate governance causes of the global financial crisis
Thomas Clarke
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28 |
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3 The failure of corporate governance and the limits of law: British banks and the global financial crisis
Roman Tomasic
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50 |
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4 Where was the ‘market for corporate control’ when we needed it?
Blanaid Clarke
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75 |
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5 Information asymmetry and information failure: disclosure problems in complex financial markets
Steven L. Schwarcz
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95 |
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6 Finance, governance and management: lessons to be learned from the current crisis
Roland Pérez
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113 |
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Part II Ownership, internal control and risk management: the roles of institutional shareholders and boards
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129 |
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7 A review of corporate governance in UK banks and other financial industry entities: the role of institutional shareholders
Robert A. G. Monks
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134 |
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8 Ownership structure and shareholder engagement: reflections on the role of institutional shareholders in the financial crisis
Roger Barker
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144 |
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9 Board challenges 2009
Jay W. Lorsch
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165 |
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10 Do independent boards effectively monitor management? Evidence from Japan during the financial crisis
Chunyan Liu, Jianlei Liu and Konari Uchida
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188 |
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11 Risk management in corporate law and corporate governance
Christoph Van der Elst
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215 |
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Part III Post-crisis corporate governance: the search for new directions
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243 |
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12 Corporate governance, capital market regulation and the challenge of disembedded markets
Peer Zumbansen
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248 |
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13 The focus of regulatory reforms in Europe after the global financial crisis: from corporate to contract governance
Florian Möslein
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284 |
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14 The Great Recession's impact on global corporate governance
James Shinn
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312 |
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15 Corporate governance in the Islamic finance industry and mitigation of risks post the global financial crises
Nasser Saidi
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348 |
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16 A holistic approach to corporate governance: lessons from the financial crisis and the way forward
Suzanne Young and Vijaya Thyil
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365 |
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Index
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389 |
William Sun
Leeds Metropolitan University
Jim Stewart
Leeds Metropolitan University
David Pollard
Leeds Metropolitan University
Review of the hardback: 'There is no doubt about the timeliness and relevance of this book. Practitioners, supervisors, regulators and those teaching or studying corporate governance would all gain from reading it. I am particularly impressed by the breadth of the analysis and the choice of contributors. It is essential that potential reforms should be based on as clear an understanding as possible of the nature of the relationship between corporate governance and the financial crisis. The introduction to the book alone should be compulsory reading for those concerned with shaping the future of corporate governance in a world-wide context.' Sir Adrian Cadbury, Honorary Professor, Aston Business School
Review of the hardback: 'Did poor corporate governance contribute to the global financial crisis? The OECD and the UK regulators felt that existing corporate governance codes were adequate: the problem was a failure to implement them. In this book, twenty-two leading scholars and leaders of corporate governance thinking take a different view. Deregulation prompted high risk taking; boards failed to understand their exposure to strategic risk; and rating agencies, paid by those they rated, were outpaced by financial innovation. Over-incentivized bank executives pursued vast securitization, high leverage and excessive risk to the ultimate detriment of everyone else. The theme emerges that the Anglo-American corporate governance paradigm, particularly as adopted in the US, gives CEOs excessive power and wealth to the shareholders' detriment. New directions are needed. This work offers some new thoughts and options.' Bob Tricker, author of Corporate Governance: Principles, Polices and Procedures, 2nd edition
'As we deal with the aftermath of the global financial crisis, those who turn for understanding and answers to this reader will find them placed in easily understood and useful contexts. The editors are to be commended for gathering essays of such transformative power and in contributing their own substantive advice.' James McRitchie, corpgov.net
