Business Ethics and Corporate Governance, Second Edition

DEVELOPMENTS IN THE UK

In England, the seeds of modern corporate governance were probably sown by the Bank of Credit and Commerce International (BCCI) scandal. The BCCI was a global bank, made up of multiplying layers of entities, related to one another through an impenetrable series of holding companies, affiliates, subsidiaries, banks-within-banks, insider dealings and shareholder (nominee) relationships. With this corporate structure of BCCI and shoddy record keeping, regulatory review and audits, the complex BCCI family of entities was able to evade ordinary legal restrictions on the movement of capital and goods as a matter of daily practice and routine. Since BCCI was a vehicle fundamentally free of government control, it was an ideal mechanism ...