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Applied and bridge studies study record
Decision Accounting & records

Decision Accounting and the Recognition Problem: Answering the OECD Objection

STATUS · Manuscript in progressSSRN · Not yet posted
Open teaching deckSSRN — not yet postedPublication record
MECHANISM
Identify the incentive structure and the condition that would falsify the claim.
RULE CHANGE
Read the intervention only after the paper shows how the current payoff space fails to support system welfare.
READER USE
Use the summary to see where private gain creates system exposure, then check the study record.
Reading βW
βW means annual system-welfare loss divided by annual industry revenue Π. Revenue is the denominator, never profit, earnings, or net income; ΔW and Π must use the same domain, same time period, and same activity boundary. See the βW methodology manual.
Contribution — what this adds to the conversation
Governance principles and decision reconstruction standards are distinct regulatory artifacts. No leading international governance framework requires the seventeen DA fields. The OECD Principles have a recognition gap of βW=1 (zero field coverage). The UNGPs achieve partial coverage (βW=0.8125) but not complete reconstruction.
WHAT'S NEW · Governance principles and decision reconstruction standards are distinct regulatory artifacts. No leading international governance framework requires the seventeen DA fields. The OECD Principles have a recognition gap of βW=1 (zero field coverage). The UNGPs achieve partial coverage (βW=0.8125) but not complete reconstruction.

The paper establishes the Recognition Theorem: international corporate governance principles do not make corporate decisions reconstructable. The OECD objection—that Decision Accounting is unnecessary because governance principles already exist—confuses framework-level expectations with decision-record standards. The paper introduces the βW metric to measure the recognition gap and shows that existing frameworks cover zero of the seventeen DA fields. Case studies of Volkswagen and Boeing 737 MAX illustrate the Hollow Win / management failure equilibrium where principles create legitimacy without accountability.