A Theory of Corporate Governance Emergence

This book demonstrates that the widely recognized failure of corporate governance in the late twentieth century and early twenty-first century parallels the severe limitations of mainstream theoretical models of corporate governance, which commonly hold an entitative view of the corporate reality. In doing so, little attention has been paid to the underlying philosophical premises and the long-unresolved difficulties of substantialism and representationalism behind the dominant modes of analyses.


“In this path-breaking attempt at providing an alternative philosophical basis for theorizing corporate governance, William Sun offers a bold, scholarly and imaginative assessment of the current state of affairs in corporate governances charting its historical evolution from Victorian Britain to the classic contribution of Berle and Mean in 1932 and up to the contemporary preoccupations with ethics, stakeholder interests, corporate purpose, control and social responsibility in business practices. . . . This is truly a laudable effort at reconfiguring the nature and practice of corporate governance, something urgently needed in these trying times, and Dr Sun is to be applauded for showing us how else we might begin to conceptualise corporate governance practice to meet the moral and environmental challenges of the new millennium.” – Prof. Robert Chia, University of Strathclyde

“Dr Sun’s approach brings us fully into a world in which the impact of social processes and inherent complexities within corporate governance are given due place. His book contains well thought-out arguments which challenge our accepted view of corporate governance and its processes and practices and is a timely addition to a rapidly developing literature. Dr Sun challenges many accepted views and his analysis is considerably thought-provoking. His book deserves the attention of scholars and others involved with the field of corporate governance.” – Prof. David Pollard, Leeds Business School

“. . . argues that a processual approach is better able to capture subtle and complex governing relationships and contextually-specific and contingent governance problems, facilitating analysis and understanding leading to more appropriate responses and solutions. It sensitizes us to the limitations – dangers – of mainstream thinking, for example, in excluding discourses of conflict and resistance. It provides a perspective on the ‘interested’ nature of constructions of discourse on corporate governance and their ideological implications in shaping thought and practice.” – Prof. Ian Sanderson, Leeds Metropolitan University

Table of Contents

List of Tables/Figures
Foreword Professor Robert Chia
1. Introduction
Practical and Theoretical Issues of Corporate Governance
Ideology of the Representation of Corporate Governance
The Processual Approach and Conceptual Models
Governing Process and Constructed Reality Structure of the Book
2. The Entitative Conception of a Corporation Introduction
The Shareholding Perspective
The Stakeholding Perspective
The Entitative Conception of the Corporation Conclusions
3. Validity Issues in Corporate Governance
Shareholding vs. Stakeholding: A Question of Superiority
Market vs. Hierarchy: A Question of ‘Optimal’ Governance Structure
The Myth of Economic Efficiency: A Question of Rationality
Corporate Dualism: A Question of the Separation Thesis
4. Ontological Barriers of the Corporate Entity Introduction
Being-Realist Ontology: The Root of Entitative Reality
Difficulties of Substance Philosophy
Spatiotemporal Dimensions in Conventional Modes of Thinking
New Trends in Understanding Time and Space
5. Epistemological Fallacy of Representationalism
Cartesian Dualism: Representation as a Rational Mind
Locke’s Empiricism: Representation as a Passive Reception
Kant’s Objective Idealism: Representation as Active Ordering
The ‘Accurate’ Representation in Modern Realism
Fallacy of Representationalism
6. Process Metaphysics: The Basic Ideas
A Processual Worldview
Key Characteristics of Process
Time and Space in Process Thought
A Processual View of Knowledge
7. A Processual Framework of Corporate Governance
Towards a Processual Thinking in Organisation Studies
A Three-Dimensional Process Model of Corporate Governance
Methodological Issues in Processual Analysis
A Processual Conception of the Corporation: Illustrations
8. The Constructing Process of Corporate Governance
The Structure-Action View of Corporate Governance
Corporate Reality as Mind-Mediated Processes
A Dual Process Model of Corporate Governance Construction
Understanding Power and Regulation in Corporate Governance
9. Ideological Representations in Corporate Governance Constructs
Competing Constructs of Corporate Governance
Ideological Roots and Constraints in Corporate Governance
Facilitating Changes in Corporate Governance: The Strategy of Discourse Formation
10. Conclusions
Current Corporate Governance Debates and Limitations
A Processual Perspective of Corporate Governance
Understanding the Processual Reality of Corporate Governance
Understanding Corporate Governance Problems