Are Codes Fostering Convergence in Corporate Governance? An Institutional Perspective

CONVERGENCE OF CORPORATE GOVERNANCE: PROMISE AND PROSPECTS, A. Rasheed and T. Yoshikawa, eds., Palgrave, 2012

15 Pages Posted: 21 Mar 2012 Last revised: 7 Jun 2013

See all articles by Ilir Haxhi

Ilir Haxhi

University of Amsterdam Business School

Ruth V. Aguilera

Northeastern University - Department of International Business and Strategy

Date Written: December 20, 2011

Abstract

This chapter discusses the role of corporate governance codes in the context of pressures for corporate governance convergence across countries. We show that there is a diverging convergence as corporate governance practices continually evolve. Further, given that codes are non-mandatory in most countries, firms can cherry pick to adopt those practices that best fit their interests. This is consistent with the view that firms as agents have some degrees of freedom in creating their corporate governance portfolio even though they are embedded in a given national or institutional environment (Aguilera & Jackson, 2003; Aguilera, Desender, & Castro-Kabbach, 2011). In this chapter, we seek to address the following questions posed in this book through the lenses of codes: What are the institutional drivers that propel firms in different nations towards convergence in corporate governance? What are the major impediments that stand in the way of convergence? What empirical evidence suggests that we are moving towards or away from convergence?

Keywords: corporate governane, codes of good governance, codes, soft law, hard law

Suggested Citation

Haxhi, Ilir and Aguilera, Ruth V., Are Codes Fostering Convergence in Corporate Governance? An Institutional Perspective (December 20, 2011). CONVERGENCE OF CORPORATE GOVERNANCE: PROMISE AND PROSPECTS, A. Rasheed and T. Yoshikawa, eds., Palgrave, 2012, Available at SSRN: https://ssrn.com/abstract=2026352

Ilir Haxhi

University of Amsterdam Business School ( email )

Plantage Muidergracht 12
Amsterdam, 1018 TV
Netherlands

Ruth V. Aguilera (Contact Author)

Northeastern University - Department of International Business and Strategy ( email )

Boston, MA 02115
United States

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