IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-1-137-33027-7_5.html
   My bibliography  Save this book chapter

Carrots for Good Governance

In: Disorganized Crimes

Author

Listed:
  • Bernard E. Munk

Abstract

There is no doubt that compensation incentives for managers that are unduly focused on contemporaneous results create inherent conflict and a potential for corporate misgovernance. This is especially true when boards fail to exercise skillful discipline of management, particularly with regard to risks undertaken by corporate managers. Under these conditions, shareholder property can be placed at risk without the knowledge of shareholders. Corporate governance can also be undermined by capital market servicers whose personal interests compromise the stewardship that their institutions should display. As their key personnel strive for increased fees and rapid promotion motivated by their own performance pay systems, capital market servicers can be negligent with regard to the risks of their clients. Account officers of these capital market servicers, therefore, also are in a position to create “agency” problems for their own companies. Negligent acquiescence of client financial results can confer a misleading seal of approval by the underwriter that is in turn transmitted to the public market. The ultimate chain of a financial tragedy is made up of many such links.

Suggested Citation

  • Bernard E. Munk, 2013. "Carrots for Good Governance," Palgrave Macmillan Books, in: Disorganized Crimes, chapter 0, pages 46-60, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-137-33027-7_5
    DOI: 10.1057/9781137330277_5
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:palchp:978-1-137-33027-7_5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.