A seduction by governance : governance, the ERO, and the irony of agency : a thesis in partial fulfill of the requirements for the degree of Masters in Management at Massey University

Abstract

It is observations that even diligent governance is no insurance against organizational failure, supported through inconsistent research results and practitioner concern, which should sound the warning bells for governance research. This ominous disquiet is punctuated by organizational failure, normally attributed to governance, and attracts significant press. This is typically accompanied by calls for even more, and ever increased, compliance requirements. Exactly how governance, performance and compliance are related is theorized as agency. The 'knowledge' that governance leads to performance forms the focus of endless research attempting to improve organizational performance, and it is reasoned that by doing so, the shareholder will be protected from loss. However, the relationships between governance, performance and compliance does not appear to have been established. A similar corporate governance arrangement, overseen by the Ministry of Education (MOE) and implemented by the Education Review Office (ERO), was adopted for the education sector in New Zealand from 1989. It was assumed that quality governance would lead to improved performance. I suggest that the MOE and ERO have drawn on the discourse of corporate governance in the arrangement of their advice for consumption by those interested in governance within schools. In this study, a discursive approach is used to examine their advice in the arrangement of governance referenced from that discourse. A critical discourse method is therefore selected, focusing on a corpus drawn from the ERO's advice over 15 years. The analysis is divided into three sections, each draw from that progressive advice. In particular, attention is paid to the consistency, or inconsistency, in their treatment of features of the text, notably performance and compliance. Within their advice it appears that there is a significant divergence between this performance expectation and the outcome. This appears to focus the governors of schools on the need for compliance, perhaps even at the expense of organizational performance. Further it appears that those subject to the discourse of governance are seduced into the continued belief that governance is both connected to performance and that, ironically, such performance will in some way directly relate to organizational protection. An outline of the discourse of governance is attempted, implications for the critical roles of governor and auditor are drawn, and agency theory is questioned.