Wen, S and Zhao, J 2010, 'Corporate governance and the financial crisis: did the theories stand the test?' , Butterworths Journal of International Banking & Financial Law, 25 (10) .

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Abstract

Three key theories - the agency theory, stewardship theory and path dependence theory have served to explain the relationship between directors and shareholders in the field of cor-porate governance. However, none of the theories alone have stood the test of the global fi-nancial crisis. · Given the multiplicity and complexity of directors' interests, directors in organisations are likely to have agency relationships with some managers and stewardship relationships with others. · Path dependence theory indicates the prevalence of voluntary codes rather than man-datory instruments in the post-crisis context. · In the authors' opinion, a combination of voluntary codes and mandatory instruments would be desirable.

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