The concept of managerial discretion has previously been discussed in the two distinct fields of corporate governance and strategic management research. Strategy researchers view discretion as a scope of opportunities for managers to act upon, while the corporate governance view is that  discretion is a potential threat for a company. We attempt in this paper to unite previously divergent perspectives on the concept by building a comprehensive model that explains the antecedents of managerial discretion at organizational and environmental levels. Within this framework, we develop a typology of managerial discretion consisting of four distinct categories. We propose that the four categories of discretion will inform situations where managers will have different degrees of influence on organizational outcomes.