Smaller business governance: Exploring accountability and enterprise from the margins

Smaller businesses now rank higher upon the corporate governance agenda. This agenda places their accountability and ‘enterprise’ particularly at issue. It is only put at issue because of just one possible problematization however. That problematization firstly assumes judicious accountability to be the crux of good governance with accounting at its hub. It secondly assumes that smaller businesses are the very seedbed of any ‘enterprise economy’, virtually irrespective of what form they take, or ‘enterprise’ they display. By then combining these assumptions together, this finally reproblematizes any relationship between accountability and ‘enterprise’, so that ‘de-regulation’ and decoupled accountability liberates smaller business ‘enterprise’ further. Others might question and challenge the very basis, as well as particular formulation, of this problematization however. A better grasp of the greater fluidity and complexity of smaller businesses would make the boundaries of their accountability and ‘enterprise’ more clear and leave their respective margins more suitably exposed. As a key potential instrument for that purpose managerial accounting research might then better inform the debate by specifically rendering these boundaries more visible while also identifying the precise scope for manoeuvre at/across their margins as well. To that end this paper uses certain enabling frameworks to construct and interpret the particular case of managerially accounting for a grown smaller business working across exactly those margins from the perspective of a ‘reflective practitioner’ acting as a field researcher for these purposes. As well as offering fresh insights into how far the boundaries of accountability and enterprise might legitimately stretch, this case calls for more critical thinking about how they might change.     

Adopting better corporate governance: Evidence from cross-border mergers

Cross-border mergers allow firms to alter the level of protection they provide to their investors, because target firms usually import the corporate governance system of the acquiring company by law. Therefore, cross-border mergers provide a natural experiment to analyze the effects of changes in corporate governance on firm value, and on an industry as a whole. We construct measures of the change in investor protection induced by cross-border mergers in a sample of 7330 ‘national industry years’ (spanning 39 industries in 41 countries in the period 1990–2001. We find that the Tobin's Q of an industry — including its unmerged firms — increases when firms within that industry are acquired by foreign firms coming from countries with better shareholder protection and better accounting standards. We present evidence that the transfer of corporate governance practices through cross-border mergers is Pareto improving. Firms that can adopt better practices willingly do so, and the market assigns more value to better protection.     

Vulnerability and industrial hazards in industrializing countries: an integrative approach

The extra vulnerability of industrializing countries to environmental problems and industrial accidents cannot be understood or solved by a ‘normal’ scientific analysis. Aspects of the social and institutional context must be included, through analyses based on post-normal science. The standard two-dimensional classification of PNS is modified to have axes ‘social ‘and institutional vulnerabilities’ and ‘complexity of technological hazards’. The analysis is mainly applied to the case of the relatively rare accidents with catastrophic potential. In these, the deaths per accident in India, Mexico and Brazil are much greater than in the industrialized countries. This discrepancy arises partly from location of such plants near residential communities for marginalized workers and their families. Other socio-political factors are relevant, as the role of these countries in the global production system, the enforcement of safety and planning laws, quality of housing, and lifestyle of residents. Reducing the vulnerability of industrializing countries will therefore require major social policies and a comprehension of the limits of the normal scientific and economic approaches to such problems.     

Role of the intellectuals in governance

Environmental degradation and lack of social cohesion are rooted in bad governance, which, in turn is rooted in the inability of the modern civilization to understand the nature of differences in human psychology and their relationship with governance. The key to good governance in future will lie in invigorating such individuals to ‘speak’ who have transcended their desires of money and power and are able to take a dispassionate view of the problems in the larger social good. Multiple networks of persons who speak the truth have to be formed for this purpose.     

The interplay between professional groups, the state and supranational agents: Pax Americana in the age of ‘globalisation'

In response to recent calls for systematic and in-depth studies of the impact of international forces on local accounting practices, discourses and institutions, this essay explores the interconnectedness of national politics with global forces and the ramifications of this interaction for the regulation of accounting and the state–profession relationship. The paper employs Held's (1991) framework [Held, D. (1991). Democracy, the nation-state and the global system. Economy and Society, 20(2), 138–172.] on the role of the nation state in the age of globalisation, extended to encompass insights from the realist paradigm on international politics, to examine the international aspects of an attempt by a group of indigenous auditors in Greece to recapture their monopoly status, following the ‘liberalisation' of the Greek auditing profession in 1992. The paper explores changes in the state–profession relationship in the era of ‘globalisation' and documents the catalystic role of major states (the USA), politico-economic blocks (the EU), and other powerful international actors. It is posited that the politics of international accounting professionalism in the ‘globalisation' era are becoming more polycentric with (lesser) nation-states as merely one level (of diminishing importance) in a complex system of superimposed, overlapping and often competing national and international agencies of governance. The lessons to be learned from the Greek experience seem to be relevant to a number of countries — weaker or more important players in the world economy and politics — as they realign the assemblage of government in accounting and in other domains, in response to the progressive internationalisation of the world economy.     

Beyond the mundane: reconciling breadth and depth in futures enquiry

For some time there has been a need within Futures Studies (FS) to develop methods which go beyond the dominant empirical tradition. For many years there has been a near-exclusive emphasis on understanding the external world ‘out there’. But as time has gone by, so it has become clear that our ability to understand the world ‘out there’ crucially depends on an underlying world of reference that is ‘in here’. Understanding the near-future environment calls for a combination of ‘inner’ and ‘outer’ views which, for example, give as much credence to judgment as to calculation. This paper considers a way of considering these very different ‘ways of knowing’. Overall, the aim is to go beyond what might be termed ‘mundane’ analysis, i.e. that which is preoccupied with surfaces, and to open out a broader arena for futures enquiry.     

The end in sight?: Some speculations on environmental trends in the twenty-first century

For a generation there has been unresolved debate between anxious environmentalists and sanguine ‘contrarians’, both of which have been able to amass strong evidence in favour of their positions. This is an important paradox, and the paper attempts to resolve it by means of an elementary but robust model of environmental trends between 1950 and 2100. A crucial feature of the approach is to disaggregate the developed ‘North’ and developing ‘South’, revealing strikingly different patterns. The North's environmental impact will decline steadily, but in the South a rapid increase in environmental impact can be expected in the first half of the 21st century, followed by an equally rapid decline. This dramatic environmental ‘spike’ will be unique in human history and mark a fundament transition to the sustainable state. Its qualities and duration will determine many features of the human and natural world for millennia to come. Many policy implications flow from this analysis. Controversially, it suggests that the ‘spike’ should be embraced and managed rather than avoided or delayed.     

Community governance

American politics, especially at the national level, has become dysfunctional; citizens are deeply frustrated with their political leaders and feel that political institutions are unresponsive and corrupted by entrenched power and money. Government leaders must bear the brunt of this anger and distrust, and subsequently feel a sense of disconnection between themselves and those whom they serve. Ironically, at the same time as the ability of local government to solve problems is severely hindered due to this ‘disconnect,' devolution at the federal and state level is forcing local government to take more and more responsibility for resolving local challenges. This essay argues that the solution to this impasse lies in re-inventing the way communities operate—we need to make a shift from government to governance. The dominant model of local politics, which fit the political landscape of the 1940s–1970s, vested decision making authority solely with governmental leadership; citizens voted and governors governed. This essay describes a new mode of operation, one where non-governmental actors are ‘granted a seat at the table.' In this model the goal of political struggles is no longer to defeat your enemy, but to reach collaborative, consensus-based decisions; government, business, community groups and citizens work together; and leaders share power, working to enable others to decide issues.     

Accountability and risk governance: a scenario-informed reflection on European regulation of GMOs

Regulating risks in the face of scientific uncertainty poses a particular challenge to policy-makers. Such problems are amplified when decisions are taken in a multi-level framework of supranational governance. The genetically modified organism (GMO) regulation in the European Union constitutes an especially salient issue of risk governance in a multi-lateral arena, as the topic is politically highly visible and decision-making is slow and contested. Furthermore, as authority is dispersed among multiple actors, European risk governance is in need of adequate mechanisms ensuring that decision-makers justify and account for their behavior. While legitimacy aspects of GMO governance have widely been examined, accountability relations within the field of GMO risk governance have hitherto only weakly been explored. Hence, this paper analyzes the question of who can be held accountable under the complex system of supranational risk governance. This paper claims that mere adherence by actors to the regulatory procedures during the decision-making process does not necessarily imply that overall accountability can be secured, resulting in ‘organized irresponsibility’. Although certain piecemeal accountability may exist, establishing overall accountability is complicated, precisely as a result of the complex system of interwoven rules.     

Futures studies in the 21st Century: a reality-based view

Futures-thinking in various ways may or may not be expanding. But it is clearly an ever-changing activity, and appears to be ever more fragmented by culture, subject matter, style, and ideology. ‘Futures Studies (FS)’ as a subset of this larger activity is highly problematic as a viable entity, due to seven disabling myths: that FS is a field, that futurists are generalists, that futurists are primarily ‘futurists’, that FS does what no one else does, that FS is generally understood and appreciated, that FS is static, and that FS is a community. In contrast to these idealized but unsupported myths, the world of futures-thinking is presented as it really is, based on the author’s preparation of over 20,000 abstracts of futures-relevant literature over the past 30 years. Underlying complexity and wide diversity are sketched in three synoptic charts on the six purposive categories of futures-thinking (and 115 different terms that have been used), 17 general topical categories, and 12 generic continua on which futures-thinkers can be located. Based on this complex and fuzzy reality, futures studies should embrace its distinctiveness and strive to be a horizontal field connecting all others—a visible, respected, and ever-renewing network of humble hubs for integrative ‘big picture’ thinking about trends and visions of probable, possible, and preferable futures. To attain this status in the decades ahead, FS must communicate a shared and frequently-revised vision, emphasize all six purposive categories (especially integration and questioning), develop a serious global information system (and use it), establish an academic presence at leading institutions, fight back against ignorant futurist-bashers, promote multiple excellences, engage in ‘second profession’ recruitment and training, and secure adequate funding. These actions are necessary for establishing any meaningful ‘futures studies’ community.     

Envisioning new--buying used: Are the Pacific Islands caught between alternative communication futures?

With the ‘complexification’ of today's society, due in large measure to rapid technological convergence in the fields of communications and informatics, developing Pacific island countries are faced with what at the surface appears to be a devil's choice: jump on the high-tech bandwagon and risk being subsumed by the Western-dominated ‘cyberculture’, or withdraw from the technology-induced developments evidenced in richer countries and thereby run the risk of falling even further behind. This dichotomy is, of course, false and paints a rather nihilistic picture of Pacific islands futures. The contention here is that such a polemic is selling the Pacific islands a ‘used future’. Therefore, it is vitally important, at this juncture, for Pacific island leaders, entrepreneurs and citizens to recognize that creative, long-term future strategies for planning and optimizing the application and use of high-tech communications in economically advantageous and culturally appropriate ways are desperately needed.     

Exploring (false) dualisms for environmental accounting praxis

This paper focuses on the political nature of the linguistic dualisms or ‘false antinomies’ that inhere in environmental accounting practice and environmental accounting research. These dualisms, ‘subject–object,’ ‘man–woman,’ ‘mind–body,’ and ‘culture–nature,’ the paper argues, need to be ‘ambiguized’ if the politics inherent in these dualisms are to be resisted. Two strategies for the ‘ambiguization’ of these dualisms are suggested: ‘performative parody,’ which is a strategy intended for environmental accounting practitioners, and ‘democratic reflexivity,’ which is a strategy intended for environmental accounting researchers. In taking this linguistic focus, the paper challenges common sense constructions of the environment and the potentially elitist and anti-democratic nature of environmental accounting research. By offering these two strategies, the paper provides a means of environmental accounting praxis, or means of resisting global ‘environmental’ domination.     

Diversity and social progress in the next millennium: an evolutionary perspective

An evolutionary framework for speculating about some of the socio-cultural and genetic diversity issues of the next millennium is developed. Human populations (societies) are basic biological and socio-cultural units. The nature of human societies is shaped by two kinds of linked evolutionary process: biological and socio-cultural. These evolutionary processes, in turn, are driven by human interactions with the physical environment, microorganisms, other species, other human populations, and by technological innovations. Preservation of genetic and socio-cultural diversity is identified as a crucial aspect of social progress over the next millennium. The impact of these ecological and technological ‘drivers of change’ on future evolutionary processes is discussed. While the world's affluent societies will be increasingly liberated from nature's constraints and enriched by technological innovations, it is questionable, given historical experience, whether poorer ones will share in the prosperity. Significant innovations in socio-cultural evolution, including new forms of governance, will be required to harness the accelerating forces of change and to ensure future social progress for all peoples.     

Social accounting research: An Australasian perspective

This paper provides an insight into the nature and the extent of social accounting research being undertaken within Australasia. It demonstrates that Australasian researchers account for a significant amount of internationally published social accounting research, but emphasises that the research effort seems to be confined to a limited number of researchers perhaps reflecting a lack of ‘take-up’ in this area in terms of the scale of participation. Information is also presented about the relative propensity of journals within the sample to publish social accounting research, and identifies that ‘top tier’ accounting journals historically have not published social accounting research. The paper also considers various factors which seem to be impeding the ‘recruitment’ of new social accounting researchers.     

Revisiting the ‘Court of Generations’ Amendment : A conversation

In 1991, futurist Bruce E. Tonn proposed a ‘Court of Generations’ Amendment to the US Constitution. His proposed ‘Court of Generations’ lacked punitive powers but, hopefully, would have sufficient legitimacy to counteract extreme present-minded thinking evident in US political processes and institutions. Although Tonn's ‘Court of Generations’ Amendment has been well received in the futures community, who else has heard of it? Otherwise, has it made any difference? How can the cumbersome and nonfuturistic amendment procedure in the US Constitution generate a futures-oriented ‘Court of Generations’? And for those who sincerely look forward to a ‘Court of Generations,’ precisely what kind of tactically savvy visionary leadership will give the ‘Court of Generations’ any chance of being approved? During 1997, Vincent Kelly Pollard engaged Dr. Tonn in an Internet conversation aimed at clarifying these issues.     

What do we know about audit quality?

This paper reviews empirical research over the past 25 years, mainly from the United States, in order to assess what we currently know about audit quality with respect to publicly listed companies. The evidence indicates that outright audit failure rates are infrequent, far less than 1% annually, and audit fees are quite small, less than 0.1% of aggregate client sales. This suggests there may be an acceptable level of audit quality at a relatively low cost. There is also evidence of voluntary differential audit quality (above the legal minimum) along a number of dimensions such as firm size, industry specialization, office characteristics, and cross-country differences in legal systems and auditor liability exposure. The evidence is very positive although there is some indication that audit quality may have declined in the 1990s, in which case there could be merit in recent reforms such as the Sarbanes-Oxley Act of 2002 in the US. However, we do not know from research the optimal level of audit quality and therefore whether we currently have ‘too little’ or ‘too much’ auditing? Despite this lacuna we are entering an era of more mandated auditing in response to high-profile corporate governance failures including the Enron–Andersen affair. Finally, while recent reforms have scaled back the scope of non-audit services due to independence concerns, a case can be made that audit quality will always be somewhat suspect if other services are provided that are perceived to potentially compromise the auditor's objectivity and skepticism. For this reason public confidence in audit quality may be increased by proscribing all non-audit services for audit clients. Recommendations are also proposed with respect to legal liability reform and changes in partner compensation arrangements.     

Global modelling in the 1990s : A critical evaluation of a new wave

It seems that after a ‘golden decade’ in the 1970s and a period of decay in the 1980s, global modelling is making a comeback. In particular, the report Scanning the Future seems to mark the beginning of a new era in this respect. In this article this ‘new wave’ of the 1990s is compared with the ‘old wave’ of the 1970s. Although there is progress in the scientific realm, these new models lack a deep concern for the burning problems of our time like the poverty gap between the North and the South and the ‘ecological problematique’. In many ways these new models reflect the new mood of the times, which lacks any vision of a new paradigm and which is strongly ‘northern-centric’.     

Governing cooperation hazards of outsourced municipal low contractibility transactions: An exploratory configuration approach

Increasingly, public sector organizations (PSOs) outsource the delivering of important welfare services. This gives rise to important questions of how PSOs can control their suppliers. The purpose of this paper is to show how PSOs manage cooperation hazards of low contractibility transactions, i.e., activities expected to be difficult to govern. The paper applies a taxonomic configuration approach which means we apply a holistic view on the governance of suppliers and search for internally congruent governance packages that also are adapted to the context of the transactions. We find indications of the importance of internal congruence in governance packages in order to effectively deal with cooperation hazards. We also notice that the intensity in and types of controls in inter-organizational relationships are affected by the amount of cooperation hazards. A conflict between a relational and a bureaucracy-based governance package in one of the configurations is argued to be the main driver behind lower expectations about positive behaviour from suppliers.     

The future of food: countering globalisation and recolonisation of Indian agriculture

India, with a billion plus population, has put agriculture at the heart of its economy and food security at the centre of its agriculture policy. However, all the decisions and policies of a free and independent India which replaced colonial policies of land alienation, and concentration on ownership of land, super exploitation of the peasantry, the creation of famines are being undone through globalisation. These policies are bringing back “zamindari” and land monopolies of colonial times. The public distribution system (PDS) is being dismantled. Farmers are committing suicides, reports of starvation deaths have become common, foreboding a return of famines last experienced under British rule. Biodiversity is being rapidly eroded, and food, the very source of health and nutrition has become a major source of health hazards caused by toxic chemicals in factory farming and new genetically engineered foods and crops. This paper examines these developments in detail and proposes an agenda for creating an alternative future of food and highlights the current practices that are working towards this alternative.     

The end of strategy : Selected bibliography

The purpose of this review is to mention some sources used in the preceding article, ‘The end of strategy’. Given the current weight of the strategy ‘literature’ and the small number of references given here, it will be clear that this is far from being a comprehensive bibliography, or even what some people would regard as a minimum reading list.