Fifth Edition – OUT NOW

Corporate Governance

Principles, policies, and practices

Bob Tricker (Oxford University Press, 2009, 2012, 2015, 2019, 2025)

Click for more information on the OUP website

 

Throughout the 20th century, the focus had been on management. But where was the board of directors on the management organization chart? The twenty-first century, however, has seen corporate governance come centre stage, with the spotlights on the way power is exercised over corporate entities around the world.

 

My interest in boards and their behaviour was kindled in the 1970s, when I was Director of the Oxford Centre for Management Studies, subsequently to become Templeton College, and then part of the Saïd Business School, Oxford. The Management Centre was incorporated as a company limited by guarantee and its board of directors, called a Council, comprised heads of Oxford colleges and leaders of major British companies. Council members always outnumbered the academic staff.  Council’s divisive cliques, political power plays, and unpredictable interpersonal relations astounded me. This was not the behaviour of the classical organization theories, analytical decision making, and basic management concepts that we were teaching in the Management Centre.

It occurred to me that governance was different from management. The governance of corporate entities and the activities of their governing bodies was a subject that deserved study. A subsequent five-year Research Fellowship at Nuffield College, Oxford, led to a paper Perspectives on Corporate Governance: Intellectual Influences in the Exercise of Corporate Governance that was published in a 1983 collection of essays edited by Oxford’s Michael Earl.

Over 30 years later, that paper’s first sentence, which linked John Maynard Keynes, John Stuart Mill, and Karl Marx, seems unbearably pretentious. But the paper did manage to introduce the subject and the phrase ‘corporate governance’. It identified some issues that remain pertinent to this day: the structure of boards; the role of independent directors; the governance of complex groups; the board’s role in strategy formulation, policy-making, management supervision, and accountability; corporate regulation; and corporate social responsibility.

I developed the ideas in the Earl paper in the book Corporate Governance, published in 1984. I remember agonizing over the term ‘corporate governance’ in the title. Although ‘governance’ was an ancient word, ‘corporate governance’ was not a phrase then in use. Indeed, I had named the trust that funded my research at Nuffield the Corporate Policy Group, not the Corporate Governance Group. Subsequently, of course, the subject has moved centre stage. Indeed, it may well be that the social historian will see the 21st century as the era of corporate governance, just as the 20th century had been that of management.

This book is rooted in material I developed over the years for executive MBA courses at the University of Hong Kong, MBA programmes at the Australian Graduate School of Management, the University of Melbourne, Hong Kong Baptist University, a distance learning course for Hong Kong Open University, and directors’ courses at the Institutes of Directors in London and Sydney, as well as corporate governance courses for Russian university teachers sponsored by the Canadian Government at the Schulich School of Business in Toronto.

Read HERE how the phrase 'corporate government' arose

The story of the governance of the Oxford Management Centre and the attitude of Oxford University to management education is described in a new book Oxford Circus.

 

What the book is about

This book will enable readers to:

•  appreciate the nature, functions, and realities of boards of directors and other governing bodies;

•  analyse board structures, systems, and procedures, including board committees, chairmen, and chief executives, board remuneration, board leadership, and board effectiveness;

•  understand major aspects of corporate governance, including:

 – corporate governance principles and codes of practice;

 – the board’s performance roles: strategy formulation and policymaking;

 – the board’s conformance roles: executive supervision and accountability;

 – the board’s responsibility for handling corporate risk;

 – the assessment of board and director performance;

 – corporate governance rating systems;

•  understand various theories of corporate governance;

•  appreciate corporate governance processes around the world, including:

 – adopting an international and comparative perspective on the subject;

 – contrasting corporate governance regimes around the world;

 – understanding the cultural aspects of different approaches to governance;

•  recognize the issues that are influencing corporate governance and board thinking, including strategic risk management, corporate social responsibility, sustainability, and business ethics.

 

About the fifth edition

This fifth edition is significantly different from previous editions. It covers the governance of all corporate entities, such as the governance of subsidiary companies in corporate groups, family firms, cooperatives, charities, universities, professional bodies, health services, and trade unions.

New material focuses on the non-financial aspects of corporate governance, including the strategic and policy implications of ESG (environment, society, and governance), climate change and zero carbon strategies, sustainability, artificial intelligence (AI), cyber-security, fin-tec, crypto currency and corporate social responsibility and business ethics. Another new chapter recognizes the importance of culture and the corporate strategic context. Challenges facing governing bodies include political and economic uncertainties, geo-political issues, material shortages and supply chain problems, and new demands for corporate reporting.

Part three of the book, on corporate governance practice, now includes insights into strategic risk assessment, remote working, the management of virtual meetings, and board security.

This edition continues the international orientation, reviewing corporate governance systems around the world. The growing contrast between corporate governance in Western democratic societies and other more authoritarian states is discussed.

The subject’s theoretical underpinnings, from law, economics, and other social sciences, are further developed and an integrative conceptual framework, based on systems theory, is proposed. The continued reliance on a 19th century model of the corporation, with shareholder ownership as the basis of power, has been questioned and alternative stakeholder-based models are reviewed. Fundamental issues arise for students, scholars, and practitioners of the subject.

This edition introduces a new definition of corporate governance, which replaces current definitions that describe the processes of corporate governance, to one that describes what corporate governance really is – the way trust is shown, power exercised, and accountability achieved in corporate entities.’

New cases have been written for this edition, including governance issues in Alibaba, Amazon, Ant Financial Services, AstraZeneca, Carillion, Great British Railways, the Mott MacDonald Group, the National Health Service, and OpenAI.

Dialogue Scenarios, a new learning feature, are introduced in Part 3 covering corporate governance practice.  These dialogue scenarios are exchanges between directors facing corporate governance issues in different entities, situations, and cultures. The dialogue scenarios emphasise the significance of board level behaviour, and the effects of inter-personal relationships, personalities, and political intrigues in governance situations.

This is an MBA level textbook that is widely used in other graduate and undergraduate courses and in director development and updating programs.

For more insights go to Reviews of Corporate Governance

Click for more information on the OUP website