Corporate governance failure at PT

The following case study depicts the bitter transfiguration of Portugal Telecom, SGPS (PT), a multinational telecommunications company that was once an honourable flag of innovation, corporate governance standards in Portugal and overseas. It scrutinises the controversial episodes that paved the way for the pitiful condition in which PT is nowadays: a company that carries the weight of a ruinous €897 million investment in a defaulted company and no more than a 25.6% stake in a heavily indebted Brazilian carrier. The free-fall is made, ironically, of a complete disregard for best corporate governance practices, allowing for PT’s major shareholders to take over the helm of the company, using it selfishly as a cash cow.