Posted: February 22nd, 2016

Discuss the claim that “We rely on shareholders to impose morality in the global marketplace” in the context of alternative theories of corporate governance

“We rely on shareholders to impose morality in the global marketplace, but are mistaken, for many corporations have no qualms about operating cartels, rigging interest rates, avoiding tax, selling horsemeat as beef, or ripping off the customer through fuel and energy pricing. Institutionalised abuses enable companies to meet stock market profit expectations, and their own. Profit-related executive pay has grown from 60 times that of the average worker to almost 180 times since the 1990s.”

Prem Sikka, The Guardian [newspaper] 11th December, 2014

1. Discuss the claim that “We rely on shareholders to impose morality in the global marketplace” in the context of alternative theories of corporate governance. (40%)
2. Identify one or more solutions to this problem of relying on shareholders to impose morality in the marketplace. (30%)
3. Assess the advantages and disadvantages of each of the solutions that you identify. (30%)