Fixing the Corporation: a Management or a Governance issue?

In this chapter I first review the current state of play in corporate governance debates, highlighting challenges to the dominant agency view. Following a critique of the economic reasoning supporting shareholder primacy I consider two contrasting approaches to fixing the problems of labour engagement and capital commitment that affect economic performance. These approaches—which could loosely be called stakeholding—differ in the emphasis given to the roles of management on the one hand and governance on the other in addressing the identified problems. I analyse them here in respect of their logical consistency and also their feasibility. A management-oriented approach is unlikely in itself to be sufficient but it may help in creating the underlying institutional supports needed for governance reform