The Governance and Disclosure of the Firm as an Enterprise Entity

26 Pages Posted: 11 Mar 2013

See all articles by Yuri Biondi

Yuri Biondi

French National Center for Scientific Research (CNRS)

Multiple version iconThere are 2 versions of this paper

Date Written: March 11, 2013


Financial crises and scandals have focused attention on received systems of corporate governance and disclosure in a way many may never have imagined and few welcomed. Not only do reforms deems to be necessary to protect stakeholders, including shareholders, but also a different understanding of the relationship between shareholding, securities markets and the business firm. This paper criticises three daydreams concerning the business firm – as a “black-box,” an “owner-entrepreneur” or a “legal person” – contrasting them with the idea of the firm as an enterprise entity. The latter concept points to a comprehensive approach that integrates accounting with economics and law. From this perspective, the accounting system is an integral part of the institutional framework of the business firm, one that demonstrates the combined implications of economic, accounting, and legal matters. In a joint business affair fraught with unfolding changes coupled with asymmetries of resources, access, control and information, the accounting system copes with the economic and monetary process generated by the whole ongoing enterprise through time. In particular, the accounting system represents and controls enterprise capitals (assets and liabilities) and incomes (revenues and costs); through its working, the accounting system allows this special enterprise process to exist and function autonomously from, and interactively with holding of shareholders’ claims and other financial securities which may be traded on Share Exchanges. Drawing upon this frame of reference and analysis, this article develops a comparative assessment of alternative corporate representations, driving implications for corporate governance, reporting and social responsibility of corporate groups.

Keywords: accounting representation, theory of the firm, corporate governance, corporate social responsibility, financial performance, financialization, accounting regulation, financial regulation

JEL Classification: G30, M40, D20, L20

Suggested Citation

Biondi, Yuri, The Governance and Disclosure of the Firm as an Enterprise Entity (March 11, 2013). Seattle University Law Review, Vol. 36, No. 2, pp. 391-416, 2013, Available at SSRN:

Yuri Biondi (Contact Author)

French National Center for Scientific Research (CNRS) ( email )

IRISSO - University Paris Dauphine PSL
Place Marechal Lattre Tassigny
75016 Paris


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