Recurring Crises In Anglo-American Corporate Governance

Publisher:
European Academy of Management EURAM
Publication Type:
Conference Proceeding
Citation:
European Academy of Management EURAM, 2010, pp. 1 - 41
Issue Date:
2010-01
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The recent prolonged systemic crisis in international financial markets was also a crisis in corporate governance and regulation. The apparent ascendancy of Anglo-American markets and governance institutions was profoundly questioned by the scale and contagion of the global financial crisis. Instead of risk being hedged, it had become inter-connected and international, and unknown. The market capitalisation of the stock markets of the world had peaked at $62 trillion at the end of 2007, but were by October 2008 in free fall, having lost $33 trillion dollars, over half of their value in12 months of unrelenting financial and corporate failures. A debate has continued for some time about the costs and benefits of the financialisation of advanced industrial economies. The long progression of financial crises around the world served as a reminder that the system is neither self-regulating or robust. The explanation of why investment banks and other financial institutions took such spectacular risks with extremely leveraged positions on many securities and derivatives, and the risk management, governance and ethical environment that allowed such conduct to take place is demands detailed analysis.
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