The SAGE Handbook of Corporate Governance


Edited by: Thomas Clarke & Douglas Branson

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  • Part 1: Origins and Development

    Part 2: Markets and Regulation

    Part 3: Boards and Directors: Leadership and Accountability

    Part 4: Boards and Directors: New Challenges and Directions

    Part 5: Competing Governance Regimes

    Part 6: Dilemmas of Corporate Governance

    Part 7: Emerging Issues: Governance and Sustainability

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    About the Authors

    Ruth V. Aguilera is an associate professor and the Fellow at the Center for Professional Responsibility in Business and Society at the College of Business at the University of Illinois at Urbana-Champaign. Her research interests fall at the intersection of economic sociology and international business, specifically in the fields of comparative corporate governance and corporate social responsibility. She currently serves as an Associate Editor of Corporate Governance: International Review and is a member of the Editorial Boards of the following peer reviewed top tier journals: Academy of Management Perspectives, Administrative Science Quarterly, Global Strategy Journal, Journal of International Business Studies, Journal of Management Studies, Management International Review, Organization Studies and Strategic Management Journal. She also serves in the board of IMDEA Social Sciences (Madrid) and CSR IMPACT Project (Brussels).

    Suzanne Benn is Professor of Sustainable Enterprise in the School of Management, UTS Business School. In this position she provides leadership within the Business School and across UTS, working with other disciplinary areas and external stakeholders to promote sustainability. She was previously Professor of Education for Sustainability, Director of ARIES and Head of the Graduate School of the Environment at Macquarie University, Sydney. Suzanne has a background in the sciences and the social sciences. She has had wide experience working across the range of educational sectors and as a research and industrial scientist. Her current research interests range across corporate sustainability and corporate social responsibility, business education for sustainability and organisational change and development for sustainability. Among her publications are Organizational Change for Corporate Sustainability (2007) London: Routledge (edited with Dexter Dunphy and Andrew Griffiths) and Corporate Governance and Sustainability: Challenges for Theory and Practice (2007) London: Routledge (edited with Dexter Dunphy).

    Vincent Bignon is visiting lecturer at the Graduate Institute for International and Development Studies, Geneva and at EconomiX, University of Paris, Nanterre. He has research interests and publications in economic history, monetary economics, search models, accounting and financial information and new institutional economics.

    Yuri Biondi is a research fellow at the CRNS, Paris and affiliated professor at CNAM, Paris. He is the Editor in Chief of Accounting, Economics, Law – A Convivium, Bepress, and convenor of the Society for the Advancement of Socio-Economics (SASE) network for Accounting, Economics and Law. He is the chairman of the American Accounting Association Financial Accounting Standards Committee. He has conducted research looking beyond the narrow boundaries of neoclassical economics to an interdisciplinary approach that integrates accounting to law and economics. His work includes a synthesis and a critique of the current state of the different economic theories of the firm, and further develops them through new insights and neglected lessons from different traditions of thought looking at the firm as a whole: as an institution and an organization, which has special functions and a distinct role in the economy and society. Among his publications is The Firm as an Entity: Implications for Economics, Accounting and the Law (2007) Routledge, edited with Arnaldo Canziani and Thierry Kirat.

    Margaret M. Blair joined Vanderbilt University's law faculty in 2004 as part of the team supporting the Law and Business Program and was appointed to the Milton Underwood Chair in Free Enterprise in fall 2010. She is an economist who focuses on management law. Her current research focuses on four areas: team production and the legal structure of business organizations, legal issues in the governance of supply chains, the role of private sector governance arrangements in contract enforcement, and the problem of excessive leverage in financial markets. Before joining Vanderbilt's faculty, Margaret taught at Georgetown University Law Center and has also been a senior fellow in the Economic Studies Program at the Brookings Institution, where she wrote about corporate governance and the role of human capital in corporations. She served on the board of directors of Sonic Corp. from 2001 through 2006. Among her published work is Ownership and Control: Rethinking Corporate Governance for the Twenty-first Century (1995) Brookings.

    Douglas M. Branson is the W. Edward Sell Chair in Business Law, University of Pittsburgh. He is the author of a pioneering work in this field, Corporate Governance (1993) Charlottesville, Virginia: Michie & Co. Douglas was professor at Seattle University School of Law, before he joined the Pitt Law faculty in the fall of 1996. He has been a visiting professor or lecturer at several law schools, including: the University of Alabama, as Charles Tweedy Distinguished Visiting Professor; the University of Oregon; Cornell University; Arizona State University; and universities in New Zealand and England. He also holds a faculty appointment at the University of Melbourne, Australia, in its Master of Laws program. He has played an influential role in framing the American Law Institute's recommendations for corporate governance. Among his recent publications are No Seat at the Table: How Governance and Law Keep Women Out of the Boardroom (2007), New York University Press, and The Last Male Bastion: Gender and the CEO Suite at America's Public Companies (2009) Routledge Press.

    Adrian Cadbury was the Chairman of the UK Committee on The Financial Aspects of Corporate Governance (1991–95) established by the London Stock Exchange, which influenced the development of codes of corporate governance throughout the world. He was chairman of the Cadbury Group from 1965–69; Managing Director 1969–74; and chairman of Cadbury Schweppes plc 1975–89. He was a director of the Bank of England 1970–94; IBM (UK) Ltd 1975–94; and chairman of the West Midlands Economic Planning Council 1967–70; and chairman of the Confederation of British Industry (CBI) Economic and Financial Policy Committee 1974–80. He was Chancellor of Aston University 1979–2004, and President of the Birmingham Chamber of Industry and Commerce 1988–1989. He was knighted in 1977, and received the International Corporate Governance Network Award 2001, and the Corporate Governance Laureate Medal 2005. He was a member of the OECD Business Sector Advisory Group on Corporate Governance, and advised the World Bank on corporate governance policy. He is a former British Olympic rower, competing in the coxless fours in the Helsinki Olympics. Among his publications is Corporate Governance and Chairmanship: A Personal View, (2002) Oxford: Oxford University Press.

    Luiz Ricardo Kabbach de Castro is completing his PhD in the Department of Business Economics at the Autonomous University of Barcelona (Spain), from which he holds a MSc. in Economics, Management and Organization. He is a research associate in Strategy and Corporate Governance at the Balearic Islands University where he teaches Strategic Management. His research interest include international and comparative corporate governance, corporate strategy, and comparative corporate law and regulation. Previous to his scholarly career he was a managing consultant at Capgemini (Spain), Andersen (Brazil) and Symnetics (Brazil).

    Thomas Clarke is Professor of Management and Director of the Key University Research Centre for Corporate Governance at the University of Technology, Sydney. Formerly he was Professor of Management at the China Europe International Business School (CEIBS) in Shanghai. His research has included being a member of the task force for the UK Royal Society of Art's Tomorrow's Company Inquiry into the sources of sustainable business success; assisting with the development of the OECD Principles of Corporate Governance in Paris; conducting a major ARC funded survey of The Changing Roles of Boards and Directors in Australia; and research with the Federal Treasury on The Regulation of Small Corporations. He has conducted corporate governance reviews for a number of organizations including PRS Ltd the intellectual property company for the UK music business. He works closely with professional bodies including the Chartered Secretaries Australia (CSA); CPA; and Australian Institute of Company Directors. Among his publications are included: Rethinking the Company (1994), London: Financial Times; Theories of Corporate Governance (2004) London: Routledge; Corporate Governance and Globalisation (2006) London: Sage (with Marie dela Rama); European Corporate Governance (2009) London: Routledge (with Jean-Francois Chanlat); International Corporate Governance: A Comparative Approach (2012) London: Routledge, 2nd edn. He is the Corporate Governance and Sustainability section editor of the Journal of Business Ethics (Springer), and a founder member of the Editorial Board of Corporate Governance: An International Review (Wiley).

    Martin J. Conyon is Professor of Corporate Governance and Finance at Lancaster University Management School, UK in the Accounting and Finance Department, and Senior Fellow at the Wharton School (Center for Human Resources) and a Fellow at Cornell University (Institute for Compensation Studies). He has held faculty posts at the Wharton School, University of Pennsylvania and the Queen's College, University of Oxford. He was a professor at Warwick University in the UK and ESSEC Business School in Paris and Singapore. Martin's research is in applied microeconomics, and recent publications have appeared in the Review of Financial Studies, Vanderbilt Law Review, the Journal of Corporate Finance, Journal of Business Finance and Accounting and the British Accounting Review. He has written over seventy articles, book chapters or reports in applied economics, focusing on compensation, corporate finance and governance issues. He serves on the editorial board of a number of journals including the Strategic Management Journal, the Journal of Business Finance and Accounting, and Strategic Organization.

    Simon Deakin is Professor of Law at the University of Cambridge, specializing in labour law, private law, company law, law and economics, and European Union law. He is a programme director in the Cambridge Centre for Business Research, and a Fellow of the Judge Business School. In 2003 and 2008 he was a Visiting Professor of Law at Columbia University and in 2004 a visiting fellow in the Department of Law, European University Institute, Florence. Since 2004 he has been Omron visiting fellow at Doshisha University, Kyoto. His books include Tort Law (2008) Oxford: Clarendon Press, 6th edn. with Basil Markesinis and Angus Johnston), Labour Law (2009) Hart Publishing, 5th edn., (with Gillian S. Morris) and The Law of the Labour Market: Industrialization, Employment, and Legal Evolution (2005) OUP, (with Frank Wilkinson). He is a editor of the Industrial Law Journal (UK) and a member of the editorial board of the Cambridge Journal of Economics. He was elected to a Fellowship of the British Academy in 2005.

    Marie dela Rama is a research associate at the Centre for Corporate Governance, UTS Sydney. She holds a PhD in corporate governance from UTS and received an Endeavour Research Fellowship from the Australian Government to complete her doctoral thesis on corporate governance reform in the Philippines. Her research interests include international corporate governance, board performance, corporate social responsibility and governance in the voluntary and aged care sectors. Among her publications are Fundamentals of Corporate Governance (2008) London: SAGE (with Thomas Clarke and Corporate Governance and Globalization (2006) London: SAGE). She is completing a monograph on family-owned business groups and corporate governance.

    Kurt A. Desender is an assistant professor of Accounting at the Department of Business Administration at Carlos III University, Spain. He holds a PhD. in Business Economics, a MSc. in Economics, Management and Organizations from Autonomous University of Barcelona (Spain) and a MSc. in Applied Economics from the Catholic University of Leuven. His main research interests lie in the area of corporate governance and finance. His research focuses on understanding the influence of the firm's internal organisation on its objective setting, managerial behaviour and performance.

    Ciaran Driver is Professor of Economics and Head of the doctoral programme in the Department of Financial & Management Studies of the School of Oriental and African Studies, University of London. He has held visiting posts at the Australian National University and has worked as consultant to government organisations on investment and innovation. He has broad research interests including macro and microeconomics; capital investment, finance and corporate governance; and industrial economics. His main current interests are in corporate governance theory and the empirical effects of governance forms on investment and R&D. He has published recently in journals such as the Cambridge Journal of Economics, Oxford Economic Papers, Oxford Bulletin of Economics and Statistics, Journal of Economic Behavior & Organization, International Journal of Industrial Organization and the Journal of Macroeconomics.

    Hans van Ees is professor in the Faculty of Economics and Business, International Economics and Business of Groningen University, Netherlands. His research deals with corporate governance, theory of business groups in emerging markets, board of directors, sustainable corporate performance and building trust within and between organizations. He is regularly involved in executive teaching, training, consultancy and contract research for private companies and the Dutch government on issues related to good governance, executive compensation and industrial democracy. He has published recently in the European Management Journal, Journal of Business Ethics, Corporate Governance: An International Review, Journal of Development Studies, and Journal of International Business Studies.

    John H. Farrar is Emeritus Professor of Law at Bond University and Professor of Corporate Governance at the University of Auckland. John has extensive experience in commercial law reform, having, for example, acted as a consultant to the New Zealand Treasury, the Law Commission, the Business Council of Australia and the UK Department of Trade and Industry. He was a member of the Legal Committee of the Australian Institute of Company Directors from 1992–2004 and was a member of the Legislation Advisory Committee in New Zealand which monitors new legislation from 2004–2008. He is a member of the editorial boards of a number of journals dealing with corporate and commercial law and is the author of many books and articles in this field in New Zealand, Australia and the UK. He was Dean of Law at the University of Canterbury (1985–1988), Bond University (1993–1996) and University of Waikato (2004–2008). He was Acting Vice Chancellor of Bond University (1995–1996) and Chair of Senate (2000–2003).

    Jonas Gabrielsson is associate professor at Lund University in the Centre for Innovation, Research and Competence in the Learning Economy (CIRCLE), a multidiscplinary research centre. He is also affiliated with the CIEL research milieu at Halmstad University. His research interests include corporate governance and value creation from entrepreneurial and strategic management perspectives. He has published recently in Corporate Governance: An International Review, Entrepreneurship Theory and Practice, International Small Business Journal, International Studies in Management and Organization, and Venture Capital.

    Joan MacLeod Heminway is College of Law Distinguished Professor of Law at The University of Tennessee (UT) College of Law in Knoxville and a fellow of the Center for Business and Economic Research, the Center for the Study of Social Justice, and the Corporate Governance Center at UT-Knoxville. Her research focuses on securities disclosure law and policy (especially under Rule 10b-5) and corporate governance issues under federal and state law. She has written numerous law review articles and book chapters, coauthored (with Douglas M. Branson, Mark J. Loewenstein, Marc I. Steinberg and Manning G. Warren, III) a business law casebook, Business Enterprises: Legal Structures, Governance, and Policy (LexisNexis, 2008), and edited and coauthored Martha Stewart's Legal Troubles (Carolina Academic Press, 2007).

    Morten Huse is Professor of Organization and Management, Norwegian School of Management BI, and President European Academy of Management (EURAM 2011–2012). He has held visiting professorships at a number of universities including Tor Vergata University, Rome, University of St. Gallen, Switzerland and Bocconi University, Italy. He is the project leader of various research projects including the Value Creating Board project. He has written or co-authored more than 15 books and over one hundred scientific articles. Areas of research include boards and governance (actual board behaviour and behavioural perspectives; governance in SMEs and family firms; boards, innovation and entrepreneurship; women directors; new paradigms of governance); stakeholder issues (CSR; ethics; stakeholder perspectives on corporate governance; environmental management); and entrepreneurship and regional development (small firms; venture capital backed firms; financing small firms; entrepreneurship and resources; corporate entrepreneurship). Among his recent publications are The Value Creating Board: Corporate Governance and Organizational Behaviour (2010) London: Routledge; and Boards, Governance and Value Creation: The Human Side of Corporate Governance, (2007) Cambridge University Press.

    Szymon Kaczmarek is a Lecturer in Strategic Management and International Business at Newcastle Business School, Northumbria University, the UK. He received his Ph.D. from the University of St. Gallen, Switzerland, and after that was holding a post of a research fellow at the University of Exeter, the UK. His research interests are on problems of corporate governance, and especially composition and dynamics on boards of directors, and on processes of internationalization of upper echelons in the context of a firm's internationalization strategy.

    Geoffrey Kiel has had an extensive career as a management educator, academic researcher, management consultant and senior manager. He was Senior Deputy Vice Chancellor and Dean of Business at the University of Notre Dame, Australia. Prior to Notre Dame Australia, for many years he was Professor of Management at the University of Queensland and headed the Graduate School of Management at that university. He is an emeritus professor of the University of Queensland. Geoff has completed pioneering work in corporate governance and board evaluation. He has been one of the major presenters on director education throughout Australia for the Australian Institute of Company Directors. He has published over 100 research papers and numerous books including Boards that Work (2002) McGraw Hill and Board Director and CEO Evaluation (2005) McGraw Hill. He is currently Chairman of Effective Governance Pty Ltd which is the successor organisation to Competitive Dynamics. Geoff has been a director of several other organisations and is a fellow of the Institute of Company Directors and has been a member of the MMRI board since 2006.

    Satomi Kimino a Lecturer of International Business and Strategic Management at Northumbria University. Previously she was a research fellow at the University of Exeter Business School. Her research interests are multinational enterprises, network of corporate grouping, foreign direct investment, technology transfer, knowledge spillovers, and corporate governance.

    Alice Klettner is a research associate at the Centre for Corporate Governance, University of Technology, Sydney. She is a lawyer admitted as a solicitor in England and Wales in 2000 and in New South Wales in 2004. Alice managed a three year research project The Changing Roles & Responsibilities of Company Boards and Directors from 2005 to 2007. This was funded through an Australian Research Council grant with Dibbs Abbott Stillman Lawyers as linkage partner. More recently she has conducted research with the Australian Council for Superannuation Investors on board performance evaluation and with Catalyst Australia looking at the governance of sustainability. Her research interests include the role of regulation in promoting board effectiveness and corporate social responsibility.

    William Lazonick is professor at the University of Massachusetts Lowell and Director of the UMass Center for Industrial Competitiveness. He is also affiliated with the University of Bordeaux and the University of Ljubljana. He has been on the faculties of Harvard University, Columbia University, Tokyo University, and INSEAD. His research has been funded by numerous governmental agencies and private foundations in Europe, the United States, and Japan. He is the author or editor of twelve books, including Competitive Advantage of the Shop Floor (1990) Harvard University Press; Business Organization and the Myth of the Market Economy (1991) Cambridge University Press and Sustainable Prosperity in the New Economy? Business Organization and High-tech Employment in the United States (2009) Upjohn Institute (winner of the 2010 Schumpeter Prize). In recent years he has published articles in Industrial and Corporate Change, Research Policy, Capitalism and Society, Enterprises et Histoire, Business History Review, Comparative Social Research, European Management Review, and Industry and Innovation.

    Mark J. Loewenstein is Monfort Professor of Commercial Law at the University of Colorado Law School. Formerly he was a member of a mergers and acquisitions practice in a Chicago law firm. His research interests center on business associations and securities law, with a particular interest in corporate governance, and he has had articles published in a variety of law reviews, including the Duke Law Journal, the Southern California Law Review, and the Georgetown Law Journal. Mark was a visiting professor of law at the University of Michigan Law School. During his career, He has actively served both the Law School and the state of Colorado. At the University of Colorado Law School he was associate dean for academic affairs, and the associate dean for research. From 1995 to 2000, he served as a member of the Colrado's Securities Board. He has also been an active member of the Colorado Bar Association's Corporate Law Revision Committee, including the subcommittee that drafted the 1994 Colorado Business Corporation Act. He co-authored the comments to that Act. From 1999 to 2005 served as a delegate to the American Bar Association House of Delegates and is an active member of the ABA's business law committee.

    Gavin Nicholson is associate professor in the Queensland University of Technology Business School. In addition to researching, lecturing and developing materials in the areas of governance policy and practice, Gavin is an experienced director, governance researcher and board consultant. He has published extensively in the leading journals of his field and currently overseas several large research projects aimed at understanding how boards operate. Gavin has provided advice on corporate governance and strategy to listed and large public companies, government owned corporations, statutory authorities, not-for-profit organisations and local government. He has published extensively in the area of corporate governance, co-authoring two books Boards that Work: A New Guide for Directors (2002) McGraw Hill and Board, Director and CEO Evaluation (2005) McGraw Hill and a manual for boards seeking to implement the ASX Corporate Governance Principles. His research interests include board dynamics and teamwork; identity and boards of directors; board decision making; and corporate governance. He has published recently in Long Range Planning, Organization Science and Corporate Governance – An International Review.

    Sabina Nielsen is associate professor in the Department of International Economics and Management of the Copenhagen Business School, Denmark and Research Associate at University of Technology Sydney, Australia. Her primary research areas include top management teams and board composition and behaviour, top management team internationalisation, and diversity in multinational corporations. She has published extensively on top management teams and strategic decision making, and on board diversity in journals including the Strategic Management Journal, Strategic Organization, Journal of Management Studies, Journal of Organizational Behavior, Journal of World Business, Corporate Governance An International Review, and Management International Review. She has won many best paper awards, and her article with Morten Huse on ‘Women Directors' Contribution to Board Decision-Making and Strategic Involvement: The Role of Equality Perception’ won the European Management Review best paper prize for 2010.

    Simon I. Peck is associate professor at the Weatherhead School of Management, Case Western Reserve University. His work examines the link between the actions and accountability of the company; characteristics of the board of directors and top management; and the firm's competitive advantage. Simon's work looks closely at the topics of executive compensation contracts, board composition and structure, and how top executives do strategic planning. He has published recently in Academy of Management Perspectives, Journal of ManagementStudies, Strategic Management Journal, Long Range Planning, Organization Science and the Academy of Management Journal. He is an editorial review board member of the Journal of Management Studies, and associate editor, Long Range Planning.

    Amedeo Pugliese is a lecturer in Queensland University of Technology Business School. He completed his doctorate at the University of Naples Federico II with a thesis on Evolutionary Patterns in Corporate Governance: the role of Boards of Directors. He is a member of the editorial board of the International Journal of Business, Ethics and Governance. He has published in the Family Business Review, Corporate Governance: An International Review and the Journal of Management and Governance on family ownership and the quality of accounting information, and boards of directors contribution to strategy.

    Annie Pye is professor and Director of Research at the Centre for Leadership at the University of Exeter Business School. Her research includes three interrelated ESRC-funded projects, each ten years apart, into how small groups of people effectively ‘run’ large companies, each predominantly underpinned by a sensemaking perspective. She has also researched topics such as non-executive director development, network leadership, learning and change and has carried out numerous research and consultancy assignments in and for private and public sector organisations. Her work is primarily qualitative and is published in a range of journals including Organization Science, Journal of Management Studies, Human Relations, British Journal of Management, Management Learning, Corporate Governance: An International Review and the Financial Times. Currently, she is researching senior managers leading change in procurement practice to achieve low carbon consumption, in a project funded by the European Social Fund.

    Xavier Ragot is a senior economist at the Banque de France and research fellow at CNRS, Paris School of Economics. He has research interests in monetary economics, incomplete markets, theory and computation and macroeconomics. He has published in The Economic Journal, Economics Studies, Review of Economic Dynamics, Economic Theory and the Louvain Economic Review.

    Paul Redmond is the foundation Sir Gerard Brennan Professor in the Faculty of Law at the University of Technology, Sydney. He is an Emeritus Professor in the Faculty of Law at the University of New South Wales and a former Dean of the Faculty. He has research interests in corporate law, corporate governance and conceptions of corporate responsibility.

    John Roberts is Professor and Chair of Discipline at the University of Sydney Business School. His recent research has focussed on corporate governance and, in particular, on understanding the dynamics of roles and relationships both within boards and between boards and institutional investors. He is a qualitative researcher who typically uses interview based research with executive and non-executive directors, CEOs and chairmen in FTSE companies, as well as with fund managers and investors to explore the actual processes through which corporate governance is effected and effective. He has published widely from this work both in academic journals and practitioner reports. His wider research interests include corporate social responsibility, organisational processes of control and accountability, narcissism and ethics. He has recently published in European Accounting Review, Accounting Organizations and Society, Competition and Change, Human Relations, The Journal of Interdisciplinary Economics, Advances in Public Interest Accounting, Organization, British Journal of Management, and Journal of Corporate Ownership and Control.

    Ruth Sealy is Senior Research Fellow, and Deputy Director of the International Centre for Women Leaders at Cranfield School of Management. Ruth's research interests cover many aspects of women in leadership, including board composition and corporate governance. Her doctoral research considered the importance of role models for female directors in investment banks, and how the lack of them may affect their work identity formation and career aspirations. Building on contemporary literature on the cognitive construction of role models, organizational demography and work identity formation, her research explains the importance of relational identification for women in a male-dominated workforce. Ruth has been the lead researcher of the annual Female FTSE Report since 2007. Sponsored by government and major organizations, the report analyzes the demographic composition of the FTSE 350 corporate boards and executive committees. Ruth has presented the report's findings to both academic and practitioner audiences. The annual report has a considerable reputation and research impact, with the findings cited in approaching 100 broadsheet newspapers, radio and television channels, and practitioner journals across the world each year. She has recently published in International Journal of Management Reviews, Gender in Management: An International Journal, and Corporate Governance – An International Review.

    R.I. (Bob) Tricker was the founder-editor of Corporate Governance: An International Review, and holds Honorary Professorships of The University of Hong Kong, where he served as Professor of Finance in the Business School from 1986 to 1996, the Open University of Hong Kong and the Hong Kong Baptist University. He was Director of the Oxford Centre for Management Studies (now the Said Business School associated with Green Templeton College, Oxford) and a Research Fellow of Nuffield College, Oxford, where he undertook the research that led to the first book to use the title Corporate Governance (1984). His original research study on aspects of corporate governance was The Independent Director (1978). Subsequently, he wrote International Corporate Governance – text, cases and readings (1994) and many theoretical and practice related papers and cases. He wrote the briefing paper on corporate governance around the world for the United Nations Development Programme project in South Korea and another for the development of corporate governance in Africa. He has been involved in developments of corporate governance in Hong Kong and China. He edited Corporate Governance (2000) in the Ashcroft series on the History of Management Thought. He is also the author of The Economist Pocket Director (1996, 1998, 2000) published in 2003 as The Economist Essential Director). The fifth edition was published in 2009 as the Economist Director. His most recent work is Corporate Governance – principles, policies and practices (2009, 2nd. edition 2012).

    Jennifer Ann Tunny is a senior research advisor with Effective Governance, a privately-owned consulting firm that provides advice on corporate governance, strategy, risk management and corporate sustainability to clients in Australia and New Zealand. Since joining the firm in 2001, Jennifer has assisted in the preparation of books and academic and practitioner articles and has played a key role in research and in the development and preparation of teaching materials used in Australian Institute of Company Director courses. She has assisted in a number of board reviews and workshops to assist clients evaluate and improve their governance processes. Jennifer has also broadened her expertise into the area of strategic management has been involved in a number of strategic planning projects.

    Shann Turnbull is the Principal of the International Institute for Self-Governance. He researches and teaches corporate governance in Australia at the Macquarie University Graduate School of Management where he obtained his PhD in 2001. His PhD thesis showed how the science of control and communication in the animal and the machine could be extended to organisations to create a science of governance as presented in his articles. His thesis built upon his education as an electrical engineer in Tasmania, BSc from the University of Melbourne and an MBA from Harvard. From 1966 to 1974 he was a founding partner in a private group that gained control of over a dozen publicly traded corporations in Australia. This gave him experience as a controlling shareholder, company director, chairman of one company, and CEO of two others. As a serial entrepreneur founding new enterprises, some of which became publicly traded, he gained further experience as a Chairman and CEO. He also became joint CEO/owner of a mutual fund management company. Among his publications are Democratising the Wealth of Nations (1975); A New Way to Govern; Organisations and society after Enron (2002) London: New Economics Foundation. He has written many papers downloadable from SSRN on corporate governance.

    Michael Useem is the William and Jacalyn Egan Professor of Management, and Director, Wharton Center for Leadership and Change Management, at the Wharton Business School. University of Pennsylvania. His research Interests include leadership, decision making, and governance; corporate change and restructuring; catastrophic and enterprise risk management. Among his recent publications are The Leader's Checklist: 15 Mission-Critical Principles (2011) Wharton Digital Press; The India Way: How India's Top Business Leaders Are Revolutionizing Management (2011) Harvard Business Press, with Peter Cappelli, Harbir Singh, and Jitendra Singh; Learning from Catastrophes (2010) Pearson, with Howard Kunreuther; and Four Lessons in Adaptive Leadership, Harvard Business Review, November, 2010; The Go Point: When It's Time to Decide (2006) Crown Business/Random House. Michael has articles on leadership, management and decision making appearing in Administrative Science Quarterly, American Sociological Review, California Management Review, Chicago Tribune, Corporate Governance, Fast Company, Fortune, Financial Times, Harvard Business Review, McKinsey Quarterly, New York Times, Sloan Management Review, Washington Post, and the Wall Street Journal.

    Gerwin van der Laan is currently a post-doctoral researcher at the University of Antwerpen, Belgium, and an assistant professor at Utrecht University, The Netherlands. He is trained as a (business) economist, and his research focuses on corporate governance including executive compensation, corporate governance codes, power, independence), and corporate social responsibility. He has published articles in Corporate Governance: An International Review, European Management Journal and the Journal of Business Ethics.

    Susan Vinnicombe is Professor of Organisational Behaviour and Diversity Management, Director of the Leadership and Organisation Development Community, and Director of the International Centre for Women Leaders at Cranfield University. Susan's particular research interests are women's leadership styles, the issues involved in women developing their managerial careers and gender diversity on corporate boards. Her Research Centre is unique in Europe with its focus on women leaders and the annual Female FTSE 100 Report is regarded as the global premier research resource on women directors. Susan has written ten books and over one hundred articles, reports and conference papers. Her most recent book is, Women on Corporate Boards of Directors – International Research and Practice (2009) Edward Elgar (with R. Burke, D. Bilimoria, M. Husen and V. Singh). The book reviews the position of women on corporate boards in the USA, Canada, UK, France, New Zealand, Australia, Norway, Iceland and Spain. Susan has consulted for organisations in over twenty countries on how best to attract, retain and develop women executives. She has advised the government in the UK, New Zealand, Australia, Finland and Spain on how to increase the number of women on their corporate boards.

    Alessandro Zattoni is currently Professor of Management at the Parthenope University of Napoli, and Professor of Corporate Governance at Bocconi University, and Professor of Strategy and Governance at the SDA Bocconi. He graduated at Bocconi University in 1993 and he received a doctoral degree in Management from the same University in 1998. He was visiting scholar at the Wharton School of the University of Pennsylvania (Philadelphia) in 1996. He attended the International Teachers Programme (ITP) at the Manchester Business School in 2001. He is fellow of the Academy of Management and of the Italian Academy of Management (AIDEA – Accademia Italiana di Economia aziendale). His publications include books and articles, in Italian as well as international journals, on many topics relating to corporate governance, such as corporate groups, stock option plans, ownership structure and board of directors. He is a screening editor for Corporate Governance – An International Review.


    It is a privilege to be invited to write a foreword to the Handbook of Corporate Governance. It is a modest title for a work of international scholarship and of fundamental significance. Entitling it a “handbook” emphasises its practical value as a relevant and accessible store of reference. It is to sit beside us, on the desk ready to hand, not left to gather dust on a shelf. The hallmark of the Handbook is the reputation of those who have agreed to contribute to its pages. All are recognised authorities in their fields. Their chapters explain the origins and development of corporate governance, the governance role of boards of directors and the governance challenges of the future. The essential aim of the Handbook is therefore to provide a source of up-to-date thinking on the issues facing those with responsibilities for managing and regulating institutions of all kinds. While the Handbook's substance and analyses will be invaluable to governance practitioners, whether they be company directors, gatekeepers or regulators, they will be of equal value to those teaching or studying in the field of corporate governance.

    The practical usefulness of the Handbook is exemplified by the coherence of approach of those writing in it. Each essay follows a common form, starting with the theoretical underpinnings of the aspect of corporate governance being addressed. The governance issues which arise in that particular context are then tested against the logic and research on which they are based. This leads on to the direction which corporate governance in a particular field is taking and to outlining areas of research which could usefully be developed. Every such analysis highlights issues which are as yet unresolved and since each chapter follows a common structure, it facilitates reading across the different themes to trace the connections between them.

    The comprehensive coverage of the Handbook provides an opportunity to consider the way in which corporate governance thinking as a whole has developed. Clearly changes in one element of governance influence changes in other elements. If regulation becomes stricter in one jurisdiction, this has its impact on the role of regulation more generally. A recent example of the part played by the international flow of ideas on governance has been the response to the under-representation of women on boards, an issue which is being addressed in different countries in different ways. All those involved in governance in their own country follow developments in their field elsewhere in the world. Investors, in particular, have an interest in promoting governance standards across national boundaries and their role as corporate monitors is discussed. The Handbook thus makes an important contribution to comparative thinking on the development of corporate governance and leads to a better understanding of the part played by these cross-connections.

    There are two further ways in which the Handbook illuminates our thinking on corporate governance as well as providing pointers to the future. The first is to underline the present breadth of the subject and the degree to which its boundaries have become extended. The early discussions on corporate governance centred on the structure within which publicly-quoted companies directed their businesses. Companies acted within a framework which was set by law, by regulation, by the market and by public opinion. The framework itself and the influence of its constituent parts varied between countries and through time, but the concept of corporate governance was essentially a limited one. It was a technical study, seen mainly through the lenses of law and economics. It took for granted the purpose of companies and was primarily concerned with the legitimacy and effectiveness of the manner of their governance.

    Contrast that earlier, narrow view of the nature of corporate governance with the range of disciplines and perspectives from which the chapters in this Handbook have been drawn. Clearly the framework within which businesses are governed remains central, but it is now assessed in the context of the role of companies in society. The emphasis on the vertical dimension of corporate governance has now been complemented by a greater concentration on its horizontal dimension. Corporate purpose and board responsibilities to the society of which they are an essential part are firmly on the governance agenda. Moral and ethical issues take their place beside economic and legal ones. The philosophical basis of governance is no longer a given but open to argument. Just as the study of corporate governance has broadened to reflect the complexity of its reach and impact on society, so has it broadened internationally in line with the way in which markets have become global. This is brought home by the array of countries from which the contributors to the Handbook have been drawn.

    The second lesson which the Handbook brings home is the rapidity with which corporate governance has grown from a specialist subject, confined to lectures on law and accounting, to a mainstream discipline in every business school. All this has occurred in a space of around thirty years. It is hard to think of another discipline which has established itself so fast in the academic curriculum. The pace with which the study of corporate governance has grown leads to two conclusions. First, that further experience, study and research will refine or alter present judgments on the subject and second that its development will continue, even if not at the same speed. As a consequence, the Handbook should be seen and used for what it is; it is a mine of practical and relevant thinking to be quarried by all with an interest in the governance of corporations. It is monumental in scope, but it looks to the past only as a guide to the future. In essence, the Handbook represents work in progress. It is a beginning not an end and is the base from which the further development of corporate governance will be chronicled.

    AdrianCadbury June 2011
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