Governance and organizational change

Authored by: John Storey

The Routledge Companion to Organizational Change

Print publication date:  October  2011
Online publication date:  October  2012

Print ISBN: 9780415556453
eBook ISBN: 9780203810279
Adobe ISBN: 9781136680908


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‘Governance’ is a term which now features large in public policy, political science and in business management. In broad terms it refers to the actors, processes, mechanisms and processes which are involved in the making of policy, the setting of strategic direction and the monitoring of executive performance against these. Numerous corporate failures and outright catastrophes in recent years have been attributed to failures of governance. Examples of ‘governance scandals’ include Lehman Brothers, Enron, Worldcom and Tyco in the USA and RBS, Mid Staffordshire Hospitals Trust in theUK. Indeed, some attribute the root cause of the global banking crisis to a failure of governance. The passivity of non-executive board members has been especially noted and so too the failure of the regulators. In response, various reviews (including, for example, one into the failings of the banking system by the Walker review in the UK) (Walker 2009) have begun to sketch out further reforms to governance. In the USA, earlier concerns about governance failure led to the Sarbanes – Oxley Act in 2002 which introduced new standards for public company boards; the post-2008 events in the financial institutions prompted calls for further reforms.

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