TOC

TOC

A shift in the cultural conception of the firm as production-system to that as investment-system entrenches the institutional logic of agency theory in governance reform. Reform initiative emphasize the separation between management and the board, forensic reporting requirements, and the primacy of stakeholders' entitlement to control and residual gains. Problems associated with this agency logic render reform unable to deliver a broad-based operating environment. The introduction of a version of stakeholder theory, augmented by Knightian uncertainty places the development of an alternative conception of the firm into discourse. Implications for governance reform are considered.