Corporate Governance Regulations and Practices in Europe - Comparative Study

Abstract

The purpose of this study is to analyze the latest developments in corporate governance systems (CGS) in European countries that are members of the European Union to identify whether CGS's (1) follow financial reporting standards on the road of convergence, and (2) whether any particular given CGS (or its component) enjoys relative competitive advantage worthy to be adopted by others. The importance of such a study stems from the fact that significant differences in corporate governance codes persist on a per-country level that may hinder cross-country firms' comparability. While such differences do not affect a firm's accounting practices per se, some regulations and practices may instead imbue strong exogenous effects on decision making that ultimately lead to measurable differences in financial statements' properties.

Keywords: accounting, international diversity in business environments, corporate governance

JEL Classification: M4