Document Type

Article

Publication Date

2018

DOI

10.5465/amr.2014.0394

Publication Title

Academy of Management Review

Volume

43

Issue

1

Pages

87-109

Abstract

We develop the concept of corporate governance deviance and seek to understand why, when, and how a firm adopts governance practices that do not conform to the dominant governance logic. Drawing on institutional theory, coupled with both the entrepreneurship and corporate governance literature, we advance a middle-range theory of the antecedents of corporate governance deviance that considers both the institutional context and firm-level agency. Specifically, we highlight the centrality of a firm's entrepreneurial identity as it interacts with the national governance logic to jointly create corporate governance discretion (i.e., the latitude of accessible governance practices) within the firm. We argue that as a firm's governance discretion increases, it will be more likely to adopt overconforming or underconforming governance practices that deviate from established norms and practices. Moreover, we propose that adopting a deviant corporate governance practice is contingent on the governance regulatory environment and a firm's corporate governance capacity. We conclude by advancing a new typology of corporate governance deviance based on a firm's over- or underconformity with the dominant national logic, as well as its entrepreneurial identity motives. This globally relevant study refines and extends comparative corporate governance research and enriches our current understanding of the institutional logics perspective.

Comments

Note: This is the author's post-print of a work published in Academy of Management Review.

The publisher's version is available at: https://doi.org/10.5465/amr.2014.0394

Original Publication Citation

Aguilera, R. V., Judge, W. Q., & Terjesen, S. A. (2018). Corporate governance deviance. Academy of Management Review, 43(1), 87-109. doi:10.5465/amr.2014.0394

ORCID

0000-0002-2070-1942 (Siri Terjesen)

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