Using Q methodology to open the “black box” of corporate governance

Corporate governance (CG) scholars have long expressed concern over mainstream research’s theoretical and methodological limitations, which often rely on oversimplified “input and output” understandings that focus solely on achieving an optimal balance between variables. This approach is particularly problematic because it tends to prioritize the narrowly defined financial interests of shareholders, leading to an overabundance of simplistic theories that fail to capture the complexities of CG.

To support these interests, researchers often rely on quantitative methods that reduce demographic characteristics and board structure to “principle-agent” issues, resulting in shallow connections that do little to represent the mechanisms of CG. As a result, boards of directors are often viewed as mythical “black boxes,” hindering deeper understandings of how to develop more effective forms of governance and address questions related to marginalization and silencing.

To overcome these limitations, CG scholars must adopt a more nuanced and comprehensive approach that considers a broader range of factors and perspectives. By doing so, the researcher asserts the development of a more sophisticated understanding of CG that takes into account the diverse needs and interests of all stakeholders, not just shareholders. This will require a shift away from simplistic theories and methods towards more complex and inclusive approaches that reflect the true nature of CG.

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This paper is published in Handbook of Research Methods for Corporate Governance

Author: Matthew Sorola