Corporate Collapse and Corporate Governance

This chapter examines the link between corporate collapse and corporate governance, focusing on whether the UK’s governance framework contributed to Carillion’s failure. It situates the collapse within the broader context of UK company law, the Companies Act 2006, and the “enlightened shareholder value” principle, alongside key governance codes. The discussion highlights the research objectives, originality, and methodology, moving beyond case description to a systemic critique of shareholder primacy. The literature review assesses contractualist perspectives that legitimise shareholder control, and considers alternative approaches, particularly Bottomley’s corporate constitutionalism which advocates stakeholder participation and more democratic decision-making. By tracing the development of these theoretical positions, the chapter provides the conceptual foundation for the book’s central inquiry on whether prevailing shareholder-oriented governance structures contributed to Carillion’s collapse and how alternative models could better safeguard against similar systemic failures.