CORPORATE GOVERNANCE IN THE NONPROFIT SECTOR: A GROUNDED THEORY APPROACH TO STUDYING THE TRUSTEE BOARD

Abstract

This thesis uses a constructivist grounded theory approach to investigate nonprofit corporate governance in the UK; using data obtained from participatory observations of board and associated meetings, workshops, and unstructured elite interviews. Open codes are generated and brought together as concepts, which are then iteratively compared and grouped in open categories. These categories are then reassembled using the paradigm model into five axial codes: the clash of orthodoxies; clash of motivations; regulator versus board power; clash of rationalities; and effective board duality. A dialectical approach is then used to create the core category of the ‘clash of neoliberal and public service world views which exists at every level of the nonprofit sector’. This core category is analysed in terms of the subordinate contradictions: at an environmental level - regulatory power versus sector power; at board level - accountability; the SMT; board practices and rituals (professionalism, actual and symbolic authority, boards meetings as theatre, and ethical standards); the concept of challenge as an expression of power relations; and rationality and decision making; and at the individual level - motivations of directors, moral duty and social purpose, social group membership, identification, credibility and trust. The substantive theory is then situated within psychology, governance, and corporate governance theories. The contribution made by the thesis are identified as the: use of ethnography to describe the inner workings of the board; creation of a model of nonprofit corporate governance; identification of the importance of political, ideological, regulatory, and ethical contexts; and concept of power, and the senior management team as a component of the board. Further research is suggested into: (i) a comparison of corporate governance in the for-profit and nonprofit sectors; (ii) challenge within the nonprofit culture; and (iii) the SMT as a major player in governance.