The Timid Corporation: Why Business Is Terrified of Taking Risk - Hardcover

'Irrational pessimism' seems to characterize the business world in the new millennium. Corporate managers seem unsure of the future and afraid to take risk.

In this brilliant book, based on primary research, Benjamin Hunt argues that risk aversion is now institutionalised in business. The belief systems that used to drive business forward in the past have broken down, replaced by fear and anxiety about change and the future. Risk aversion has now become a more permanent mindset and mode of operation, existing even in periods of economic recovery.

The Timid Corporation shows that managers are on the defensive. Worried about appearing to be unethical, irresponsible, failing to manage risk, and inefficient with capital, managers have imposed a massive new raft of self-regulation on corporate behaviour - from ethical codes of conduct, to risk management procedures, corporate governance rules, sustainable development and corporate social responsibility regulation. At the same time, corporations have never been more defensive in their commercial behaviour. Today, corporations aim to get 'close to the customer' at all times, are obsessed with brand loyalty, only innovate in a safe fashion, and avoid bold investment.

The Timid Corporation throws down a challenge to this new risk aversion. Industry needs to adopt a far more critical attitude to self-regulation, and raise its aspirations when it comes to technological innovation and economic growth.

'This book provides a much needed critical intervention in the governance and risk management mania that has characterised corporate regulation in the past ten years. Benjamin Hunt challenges us to reinterpret the mantras of brand management, customer focus, stakeholder dialogue, shareholder value and many more as products of an anxious society populated by defensive corporations, fearful of markets and led by empty political systems. The Timid Corporation is refreshingly provocative, and offers a timely reminder of the paradox of corporate regulation in the post-Enron world which can never restore trust. This book is essential reading for managers, politicians and academics concerned with the consequences of a culture of corporate risk aversion for genuine innovation."
Michael Power, P.D. Leake Professor of Accounting, and Co-Director, ESRC Centre for Analysis of Risk and Regulation, London School of Economics