A behaviourally plausible decision centred perspective on the role of corporate governance in corporate failures : A thesis submitted in partial fulfilment of the requirements for the degree of Doctor of Philosophy at Lincoln University

Abstract

The primary focus of this thesis is to answer “What is the role of corporate governance in corporate failures? Does poor corporate governance lead to corporate failures? If so how?”. In doing so the thesis examines the literature from multiple fields including corporate governance, corporate failures and organisational decision making, and identifies a research gap to analyse and explore the relationship between corporate governance practices and corporate failures through a behavioural lens. In approaching this, a qualitative research methodology is adopted to analyse the failure of Enron Corporation and Nathans Finance Ltd. The research considered the case study organisations as the primary unit of analysis and the decision makers as the secondary unit of analysis. Based on this research approach, the thesis reports the analytical results drawn from extensive and triangulated secondary data. The thesis then interprets the results in the context of the theoretical synthesis. The thesis contributes towards filling a gap in the research and presents a behaviourally plausible decision centred model of the role of corporate governance in corporate failures. The model highlights the critical role of the behavioural aspects of corporate governance decision making in corporate failures, and focuses attention on the underexplored aspects of corporate governance decision making. The thesis also suggests a further understanding of ‘A Behavioral Theory Of The Firm’ (Cyert & March, 2001) in relation to corporate failures.