Myths and ceremonies among the corporate governance institutions: introducing the concept of corporate governance culture

Abstract

Purpose The purpose of this study is to provide the conditions for governance effectiveness and explain why the same rules often result in not the same norms. Design/methodology/approach The author proposes a “corporate governance culture” concept explaining the differences within corporate governance institutions and making it possible to measure their effectiveness. Based on a literature review that included 186 research studies published in the corporate governance field, the author found that most (160) concern structural numerical variables. Only 26 refer to behavioural and cultural issues, and they support the idea of an interdisciplinary approach to governance problems. Findings A significant contribution of this paper is that it proposes an integrative framework that operationalises psychological, sociological and philosophical issues that influence corporate governance mechanisms. The proposed concept can reanimate the debate about the need for tight governance regulations or leaving room for a loose governance regime. Originality/value The idea of “corporate governance culture” explains the divergences identified in studies on corporate governance mechanisms, pointing out behavioural and cultural issues as crucial aspects of governance bodies.