Governance in professional service firms.
Brennwald, Alex Willy.
Date of Issue2008
College of Business (Nanyang Business School)
This paper aims to deliver new insights into the field of governance in professional service firms by bringing together and comparing the latest theoretical as well as practical findings and furthermore to provide recommendations for both practitioners and scholars. In order to achieve this goal, this thesis challenges research with practice to equally reflect both perspectives. The conclusions from this paper are the following: Professional service firms definitely benefit from good governance principles. Properly set up governance principles have the potential to resolve critical agency conflicts within the professional partnership and hereby enhances the firm’s performance potential. The chosen legal structure has furthermore the potential to strengthen the partnership principle by adequately reflecting the partnership’s norms and vision in the legal form. The reversed KISS principle (Hilb, 2005) provides a situational, strategic, integrated, and controlled approach on governance issues and hereby helps to keep the balance between fostering entrepreneurial behaviour and assessing overall risk exposure what furthermore keeps the partnership principle alive.