Sharpening corporate governance


Not surprisingly some commentators are beginning to think about the implications for Corporate Governance, especially in financial institutions, of the economic storm we are experiencing.

This article by Michael Schrage at the Financial Times proffers some suggestions. I am not sure how workable his ideas might be in practice, but I like the idea of risk management coming more to the fore. Schrage makes the valid point that simply overlaying more regulation such as Sarbanes-Oxley did will not solve the problem.

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2 responses to “Sharpening corporate governance

  1. michael schrage

    hi

    i authentically believe that my suggestions/proposals are ‘workable in practice’ if, for no other reason, people would be hardpressed to demonstrate why these ideas aren’t while sarbox was…

    …the core point i seek to make is that we have to have mechanisms that better link transparency to accountability to systemic risk…obviously, the ‘traditional’ approaches didn’t just fail, they failed in the biggest and worst ways possible…

    …when you have THAT kind of failure, it’s time to return to first principles rather than try to ‘buy’ or ‘overregulate’ your way out…

    my first principles: transparency; accountability and how do we create accessible ‘systems’ views of our environments WITHOUT imposing burdensome rules

  2. Michael Schrage was kind enough to comment on this post.

    I think he has a point, why did so many accept Sarbox, when clearly risk was the issue

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