The Language of Ownership and the Rise of Shareholder Value: the Corporate Governance Discourse, 1980-1999

Abstract

The purpose of this dissertation is to analyse the changing discourse on corporate governance in the USA during the last two decades of the 20th century, with a focus on persuasive strategies and linguistic choices. A detailed qualitative study, using critical discourse analysis, is conducted of a selection of six speeches of SEC (Securities and Exchange Commission) Commissioners who served during the period in question, as well as of Milton Friedman’s 1970 New York Times article on the social responsibility of corporations. This is accompanied by quantitative analysis, using the tools of corpus linguistics, of three corpora of texts: the entire set of speeches of SEC Commissioners over the period, and samples of articles from the New York Times and Wall Street Journal. The three corpora together comprise over 14 million words. This dissertation represents an original contribution to knowledge in several ways. First, fresh insights are added to existing research on the decisive break in the discourse on corporate governance that took place during the 1980s. By systematically analysing collocations and concordance lines, new light is shed on the contexts in which terms such as shareholder value and corporate governance are used. Secondly, the progression of the dominant themes in the discourse on corporate governance such as takeovers, compensation, and institutional investors over the 20- year period is explored. Thirdly, this research establishes how the different narratives, or stories, told by the SEC commissioners evolved and the extent to which these narratives are mirrored in press coverage of corporate affairs. Fourthly, this dissertation shows how the representations of the key groups of actors in the arena of corporate control, namely managers, directors and shareholders, developed over the period both in the speeches analysed and the three corpora. Fifthly, the way in which the notion that shareholders own the corporation has been used over the period to support different argument strategies is critically examined. The accentuation of only one element of ownership, namely the rights of owners, was pivotal in establishing shareholder primacy as a dominant paradigm of corporate governance. Finally, this research includes a systematic examination of Milton Friedman’s 1970 NYT article on corporate social responsibility which is a classic statement of the case for shareholder value in the public discourse.