This thesis examines the causes of financial malfeasance in the largest U.S. telecommunications corporations between 1995 and 2004. Specifically, it examines whether or not the executive compensation package influences the likelihood that a corporation will falsify its financial statements. The methods used are both qualitative and quantitative. I approach the question form a historical point of view and attempt to identify certain salient characteristics within the telecommunications industry that may influence of unethical or illegal activity. The findings support organizational-political embeddedness theory, which suggests that differential social structures create dependencies, incentives, and opportunities to engage in financial malfeasance. The historical analysis shows that neoliberal policies enacted in the mid-1990s resulted in organizational and political structures that permitted managers to engage in financial malfeasance while limiting the efficiency of regulatory bureaucracies. The quantitative analysis yields mixed findings, many of which are consistent with previous research on white-collar crime and financial malfeasance. This article adds to existing literature by outlining significant public policy shifts and the results those shifts may have on specific industries. These findings have important implications for political officials and corporate oversight organizations.

As a part of multinational corporations (MNCs), subsidiaries operate in distinct host countries and have to deal with their external context. Host country political embeddedness, in particular, helps subsidiaries to obtain knowledge and understanding of the regulatory and political context, and to get access to local networks. Moreover, they get some guidance and support from their headquarters. Distance between MNC home and host countries, however, alienates subsidiaries from the MNC and influences the extent of subsidiary host country political embeddedness. We suggest that the host country political and regulatory context moderates the effect of distance on subsidiary host country political embeddedness by reducing the need and/or value of headquarters support. Using a sample of 124 European manufacturing subsidiaries, we find that distance (space) and context (place) matter jointly: the impact of distance is stronger for subsidiaries that operate in host countries with low governance quality and low political stability in place.