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ISSC 2016 : International Soft Science Conference
Corporate Governance Research in Emerging Economies: The
Need for Alternative Perspectives
Nor Zalina Mohamad Yusof
a
*
* Corresponding author: Nor Zalina Mohamad Yusof, nzalina@uum.edu.my
a
School of Accountancy, Universiti Utara Malaysia, 06010 Sintok, Kedah, Malaysia
Abstract
This paper argues that corporate governance research in emerging economies is dominated by agency theory
perspective. While agency theory is important in explaining corporate governance in these economies, this paper
argues that it is not sufficient. Alternative perspectives are needed in explaining the practice of corporate
governance in emerging economies more holistically as emerging economies have different institutional context
and non-economic factors as compared to more advanced economies. In doing so, this paper reviews corporate
governance literature, focusing on those studies conducted in emerging economies, with the purpose to provide a
detailed commentary on the nature of existing research on corporate governance in these economies and identify
gaps in this literature. This paper proceeds by explaining on why Agency Theory is not sufficient and suggests for
future work.
© 2016 Published by Future Academy www.FutureAcademy.org.uk
Keywords: Corporate Governance; developing economies; agency theory; institution.
1. Introduction
Review of corporate governance literature shows that both research and practices of corporate
governance are dominated by the agency theory. Under this perspective, corporate governance is seen
as a mechanism by which to deal with the issue of separation of ownership and control. Research and
practice focus on how to reduce the loss of the firm’s value as a result of this separation of ownership
and control. Review of literature also shows that despite the dominance of the economic perspective,
efforts have been made to explain corporate governance from other views including institutional view,
power, and politics. However, in emerging economies, research utilizing institutional perspective is
http://dx.doi.org/10.15405/epsbs.2016.08.113