Thursday, August 16, 2012
Rakesh Khurana
Unforeseen by the intellectual architects of the revolution in economics and finance was that by delegitimating the old managerialist order and turning executives, in theory and practice, into free agents who owed their primary loyalty to a group who assumed no reciprocal obligations to them, they had cut managers loose from any moorings not just to the organizations they led or the communities in which those organizations were embedded but even, in the end, to shareholders themselves. The resulting corporate oligarchy had no role-defined obligation other than to self-interest. The unintended consequences . . . include the string of corporate scandals involving misstated earnings, backdated stock options, and various exotic variations on these themes that have as their common thread the enrichment of individual executives at the expense of shareholders, employees, and the public trust in the essential integrity of the system on which democratic capitalism itself depends.
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From Higher Aims to Hired Hands: The Social Transformation of American Business Schools and the Unfulfilled Promise of Management as a Profession
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