Schumpeter: Corporate constitutions

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“REVOLUTIONS” can take place in surprising places. The past decade has seen nothing less than a revolution in the command centres of capitalism: corporate boardrooms. The ancien régime of club ties and long lunches has been swept aside, and replaced by a new order based on transparency and accountability.
The new order has its roots in the work of sans-culottes such as Sir Adrian Cadbury in the 1990s. But it was given a powerful shove in 2001-02 by debacles at Enron and WorldCom, and the subsequent Sarbanes-Oxley legislation. Reformers in America and elsewhere argued that checks and balances were just as important in the corporate realm as they are in politics. Companies needed to have powerful shareholders and independent directors to keep a watchful eye on managers. In 2009 both the New York Stock Exchange and the NASDAQ demanded that companies should have a majority of independent directors.
Booz & Company's annual survey of the world's biggest public companies shows how ...