The Emperor's New Clothes: Why Boards and Managers Find Accountability Relationships Difficult
| Author | Jill Mordaunt |
| Published date | 01 September 2006 |
| DOI | 10.1177/095207670602100309 |
| Date | 01 September 2006 |
| Subject Matter | Articles |
120
The
Emperor’s
New
Clothes:
Why
Boards
and
Managers
Find
Accountability
Relationships
Difficult
Jill
Mordaunt
Open
University
Abstract
In
their
book
on
corporate
governance,
Lorsch
and
McIver
(1989)
document
that
board
members
said
they felt
confident
in
their
ability
to
question
the
CEO
of
their
organisation
about
matters
of
concern.
Yet
in
their
observed
performance,
board
members
rarely
did
this.
If
board
members
raised
problems,
this
was
generally
done
covertly
and
outside
the
board.
Similar
accountability
issues
occur
in
nonprofit
organisations.
Board
performance
rarely
reflects
the
rhetoric
implicit
in
regulatory
and
legislative
requirements.
There
are
competing
and at
times
contradictory
expectations
and
demands.
How
do
boards
and
managers
seek
to
balance
these
in
ways
that
allow
them
to
maintain
their
integrity
and
yet
still
satisfy
the
expectations
of
different
stakeholders?
This
paper
explores
some
of
the
issues
that
make
accountability
problematic
for
boards
and
managers.
It
then
outlines
how
different
stakeholders
have
differing
capacities
to
enforce
accountability
demands.
This
creates
complex
dilemmas
for
boards
and for
managers
because
there
are
not
options
to
fulfil
one
demand
and
not
the
other.
However,
the
paper
also
suggests
that
there
is
a
game
played
that
raises
interesting
issues
about
how
accountability
is
enacted
in
organisations.
Finally,
it
outlines
the
issues
that
need
investigation
to
understand
the
strategies
boards
and
managers
adopt
to
deal
with
these
problems.
Accountability
as
Paradox
Everyone
has
their
stories
about
the
ways
in
which
accountability
demands
can
produce
responses
that
seem
bizarre
to
a
disinterested
observer.
For
example,
an
urban
regeneration organisation
was
required
to
report
to
parliament
the
number
of
trees
it
planted
each
year
though
this
had
little
to
do
with
its
main
purpose
(which
was
rather
less
tangible).
A
development
charity
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