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Vasudev, P.M.; Watson, Susan --- "Introduction" [2012] ELECD 382; in Vasudev, M. P.; Watson, Susan (eds), "Corporate Governance after the Financial Crisis" (Edward Elgar Publishing, 2012)

Book Title: Corporate Governance after the Financial Crisis

Editor(s): Vasudev, M. P.; Watson, Susan

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9780857931528

Section Title: Introduction

Author(s): Vasudev, P.M.; Watson, Susan

Number of pages: 22

Extract:

Introduction
P.M. Vasudev and Susan Watson

CORPORATE GOVERNANCE ­ AN OVERVIEW

For a short while in 2008­09, as the wave of the Global Financial Crisis
swept over us, it seemed that the world might change. The tenets that
underpinned our economic systems were called into question, and faith
in the invisible hand of the market wavered. When speculative credit
derivatives business began to unravel at many large financial institu-
tions, it threatened to destroy giant companies of long standing, such
as Citigroup and American International Group (AIG). This sparked
fears about a systemic collapse at the global level. The disaster, largely
of human making, was averted by the `bailouts' organized by the gov-
ernment of the United States in coordination with the Federal Reserve.
Once the immediate crisis had passed leaving the rescued institutions
intact, the immediacy of the need for fundamental change also seemed
to pass.
Several years on, the world looks much the same. The clean-up after the
acute emergency of the sudden meltdown continues. To cynics, the inter-
national response to the Financial Crisis has had a dreary predictability:
much hand wringing, and regulatory responses that addressed symptoms
of the Crisis without touching the underlying malaise. Indeed, writing in
2008 just before the onset of the Global Financial Crisis, La Porta et al.
compared and contrasted the policy-implementing focus of civil law juris-
dictions with the market-supporting focus of common law jurisdictions
­ to the latter's advantage. The paper concluded:

The world economy ...