Enterprise and accountability: striking a balance

Explores the relationship between enterprise and accountability within the context of the UK corporate governance debate over the last decade. The development of the corporation, through the concept of limited liability and the consequent separation of ownership and control, enabled entrepreneurial activity to flourish within a framework of corporate accountability defined by company law and accounting and audit practice. Financial scandals during the 1980s highlighted the apparent inadequacies of this framework to meet the demands of the current business environment, leading to a series of policy recommendations relating to corporate governance. These recommendations were initially based on a central concern with accountability and control but it has been argued that this focus potentially inhibits enterprise: more recent pronouncements have emphasised broad principles rather than detailed prescription in an attempt to correct this balance. This shift in emphasis is traced and it is suggested there is sparse evidence to support the contention that accountability hinders enterprise.