FINANCIAL CRISIS AND BUSINESS GOVERNANCE

DILIP M. MISAL¹*
¹Department of Economics, CSPM Arts Senior College, Dr Babasaheb Ambedkar Marathwada University, Aurangabad, 431004, Maharashtra
* Corresponding Author : dilipmisal2012@rediffmail.com

Received : 15-07-2016     Accepted : 03-08-2016     Published : 14-08-2016
Volume : 7     Issue : 1       Pages : 268 - 269
Int J Econ Bus Model 7.1 (2016):268-269

Keywords : Financial Crisis, Shareholder, Business
Academic Editor : Mamata Hatkar
Conflict of Interest : None declared
Acknowledgements/Funding : None declared
Author Contribution : None declared

The financial crisis of 2010-11 highlighted the fault lines within business governance. The growing influence of the shareholder value norm on business apply had exacerbated the asset price bubbles of the 2000 and 2010s and heightened the fragility of financial sector firms. Failing firms had not, on the whole, suffered from inadequate governance as that was defined by the consensus of the time; the majority of them had independent boards, separate chair and CEO roles, and limited defenses, if any, next to hostile takeover. Yet, the direct response of policy makers was to suggest a strengthening of the shareholder value norm, with a rising role for self-governing director and outside saver monitor proposed as events likely to stop future business failures. As the instant disaster receded in the course of 2009-10, so did the force for reform, which in any case had debatable failed to speak to the principal payment of supremacy to the crisis, that is the shareholder value norm itself.