ABSTRACT
When regulators begin to advocate building values and culture into corporate governance codes, you know three things are happening, none of which are good. First, the public are so disenchanted with the performance and morals of directors and managers that they are complaining loudly to the politicians. Second, the politicians are putting pressure on the regulators to remove this increasingly uncomfortable burden from themselves. Third, the regulators will try to respond to a political initiative but will always seek to reduce complex issues to such simplicity that they become prescriptive, mechanical and ultimately meaningless. Meanwhile, regulatees then focus their learning on how to beat the system. However, this process allows the politicians a short-term sense of completion while having a long-term cost for the nation.
