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

Charles Harvey, Mairi Maclean, Michael Price

Research output: Contribution to journalArticle

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.
Original languageEnglish
Number of pages19
JournalCritical Perspectives on Accounting
Early online date10 Jul 2019
DOIs
Publication statusE-pub ahead of print - 10 Jul 2019

Keywords

  • Accountability
  • Corporate governance
  • Disclosure
  • Executive remuneration
  • Greenbury Report
  • Transparency

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Sociology and Political Science
  • Information Systems and Management

Cite this

Executive remuneration and the limits of disclosure as an instrument of corporate governance. / Harvey, Charles; Maclean, Mairi; Price, Michael.

In: Critical Perspectives on Accounting, 10.07.2019.

Research output: Contribution to journalArticle

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