Explaining Financial Scandals: Corporate Governance, Structured Finance and the Enlightened Sovereign Control Paradigm

Student thesis: Phd


Submitted by Vincenzo Bavoso for the degree of PhD entitled "Explaining financial scandals: corporate governance, structured finance and the enlightened sovereign control paradigm", School of Law, Faculty of Humanities, The University of Manchester, 30/06/2012.The explosion of the global financial crisis in 2007-08 reignited the urgency to reflect on the origins and causes of financial collapses. As the above events kick-started an economic meltdown that is still ongoing, comparisons with the Great Crash of 1929 started to abound. In particular, the externalities that a broad spectrum of societal groups had to bear as a consequence of various banking failures highlighted the necessity of a more inclusive and balanced regulation of firms whose activities impact on a wide range of stakeholders.The thesis is centred on the proposal of a paradigm, the "enlightened sovereign control", that provides a theoretical, institutional and substantive framework as a response to the legal issues analysed in the thesis. These stem primarily from the analysis of two sequences of events (the 2001-03 wave of "accounting frauds" and the 2007-08 global crisis) which represent the background upon which modern financial scandals are explained. This is done by highlighting a number of common denominators emerging from the case studies (Enron and Parmalat, Northern Rock and Lehman Brothers) which caused financial instability and scandals. The research is grounded on the initial recognition of theoretical themes in the field of corporate and financial law, which eventually link with the more practical events examined. This parallel enquiry leads to the investigation of two heavily interrelated spheres of law and finally highlights more practical legal issues that emerge from the analysis.Through this multifaceted approach, the thesis contends that the occurrence of financial crises during the last decade is essentially rooted in two main problems: a corporate governance one, represented by the lack of effective control systems within large public firms; and a corporate finance one identified with the excesses of financial innovation and related abuses of capital market finance. Research conducted in this thesis ultimately seeks to contribute to current debates in the areas of corporate and financial law, through the proposals of the "enlightened sovereign control" paradigm.
Date of Award31 Dec 2012
Original languageEnglish
Awarding Institution
  • The University of Manchester
SupervisorPierre Schammo (Supervisor) & Rilka Dragneva-Lewers (Supervisor)


  • financial scandals; global financial crisis; corporate governance; company law; structured finance; financial law; financial regulation; enlightened sovereign control paradigm

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