There are two types of academic research that can inform corporate governance.
The first is empirical, which uses large-scale data to guide both the diagnosis and treatment of existing practices. Views on corporate governance are sometimes shaped by a small number of high-profile anecdotes. It’s important to assess how widespread corporate governance problems are and assess the myriad potential causes before suggesting remedies. Often, proposed solutions may already be established in other countries or companies. Careful analysis of such practices, distinguishing causation from correlation, can result in them being adopted elsewhere.
The second is theoretical, where a model of a firm, industry or economy allows researchers to analyse the impact of new practices – even those not currently implemented anywhere. This approach is similar to a city simulator.
It’s important to be critical of research. You can usually find “evidence” to support any viewpoint, but there is a great disparity in the rigour and quality of that evidence. Similarly, the validity of a model’s predictions depends on the realism of its assumptions. The research included here is published in the most rigorous peer-reviewed journals, and we include a non-technical summary of the main findings. In addition to academic research, we also feature articles written by leading practitioners.
Research subject areas covered