Crises, CEO Accountability and Corporate Responsibility

Student thesis: Doctoral ThesisDoctor of Philosophy


In Room 2123 of Rayburn House, Washington the CEOs of BP, Volkswagen, Equifax and Facebook each testify to Congress. Three stops along the Capitol subway system to Room 2538 of the Dirksen Senate Office building and the CEO of Wells Fargo testifies to the Senate. All are accepting responsibility, under oath, for some of the biggest corporate scandals in history; and committing to take the necessary steps to ensure 'this can never happen again'. Scholars’ expectations are that public accountability should incentivise companies to achieve high levels of corporate responsibility, but the empirical evidence is that it does not. In seeking to explain this paradox this thesis takes a positivist approach to mid-range theory development using mixed methods.

A novel analytic framework hypothesises CEO personal accountability (M) as the most explanatory variable mediating the effect of crises (X) on change, compliant change, and/or systemic change in corporate responsibility (Y). The framework details three mechanisms of public accountability: public shaming, financial penalties, and enforcement orders and their direct and indirect effects which can be manifest at three levels – low, medium and high. The deployment of the framework to examine (M) in combination with observed change (Y) facilitates the breadth and depth of analysis required to empirically examine four propositions.

Deep case studies examine: BP's Deepwater Horizon crisis (2010), VW's Emissions crisis (2015), Wells Fargo's Unauthorised accounts (2016), Equifax's Data breach (2017) and Facebook's role in the Cambridge Analytica scandal (2018). Content analysis of Congressional records; corporate communications; ESG disclosures; Securities and Exchange Commission filings and stock market data are analysed to examine the accountability of 14 CEOs. Data is analysed in a five-year framework: two years ex-ante to examine antecedent conditions, the period of the crisis in which the company and Congress signals its intentions, and two years ex-post to assess change in corporate responsibility and to monitor persistency.

The principal theory-based contribution of this study is the theory of ‘Accountability Subversion’. The public demand that irresponsible actors are held to account by regulators for causing environmental and social harm. This demand conflicts with normative, coercive and mimetic pressures to prioritise economic interests over environmental and social concerns. To reconcile this conflict, CEOs subvert their public accountability by using countermeasures.

Countermeasures are actions to undermine the direct and indirect effects of the mechanisms of public accountability i.e., public shaming, financial penalties, and enforcement orders. Such countermeasures are commissioned by CEOs and Boards of Directors (elected by shareholders) and developed by an ecosystem of professional service firms including accounting, legal, and public relations consultants. Accountability subversion constrains public accountability, decouples reputational harm from core business operations, and may inadvertently incentivise greenwashing.
Date of Award1 Jul 2023
Original languageEnglish
Awarding Institution
  • King's College London
SupervisorGiana Eckhardt (Supervisor) & Robyn Klingler-Vidra (Supervisor)

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