Executive remuneration and the limits of disclosure as an instrument of corporate governance

Harvey, Charles, Maclean, Mairi and Price, Michael (2020) Executive remuneration and the limits of disclosure as an instrument of corporate governance. Critical Perspectives on Accounting, 69. p. 102089. ISSN 1045-2354

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Abstract

Why does disclosure continue to be seen as a panacea for failings in corporate governance, despite mounting evidence that it is a weak instrument of control? Through a micro-historical study of the constitution and deliberations of the Greenbury committee, which placed executive remuneration disclosure at the heart of UK corporate governance, we demonstrate how disclosure was discursively constructed by elite business leaders as a primary requirement of accountability of agents to owners. Our research, conducted twenty years after the publication of the Greenbury recommendations in 1995, is based on oral history interviews with surviving members of the committee and its professional advisers, who came to lament that their efforts perversely had helped escalate rather than moderate top executive pay. We argue that disclosure is a poor surrogate for real engagement by owners in corporate governance, and propose four general conditions that, if satisfied, might lead to increased accountability.

Item Type:	Article
Uncontrolled Keywords:	Accountability, Corporate governance, Disclosure, Executive remuneration, Greenbury Report, Transparency
Subjects:	N100 Business studies N200 Management studies
Department:	Faculties > Business and Law > Newcastle Business School
Depositing User:	Elena Carlaw
Date Deposited:	10 Jan 2020 12:33
Last Modified:	15 Sep 2020 11:31
URI:	http://nrl.northumbria.ac.uk/id/eprint/41878

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