Convergence of National Corporate Governance Systems : Localizing and Fitting the Transplants

• Main Author: Larsson Olaison, Ulf
• Format: Doctoral Thesis
• Language: English
• Published: Linnéuniversitetet, Institutionen för ekonomistyrning och logistik (ELO) 2014
• Online Access: http://urn.kb.se/resolve?urn=urn:nbn:se:lnu:diva-51773; http://nbn-resolving.de/urn:isbn:978-91-87925-17-7

The purpose of this thesis is to elucidate the phenomenon of legal transfers fromthe perspective of the dominant comparative corporate governance researchparadigm. Drawing on legal studies and empirical observations, the thesis developsa terminology for understanding the legal transplant metaphor in comparativecorporate governance and problematizes the debate on the convergence ordivergence of corporate governance systems.This purpose is achieved through five empirically-based articles that areincluded in the thesis. The first article concerns a change in the SwedishCompanies Act that allows for stock repurchases. The second article discusses thevoluntary and then mandatory introduction of nomination committees. The thirdand the fourth articles focus on the introduction of the Swedish corporategovernance code. Finally, the fifth article discusses the role played by independentdirectors in the Swedish corporate governance setting.The focus on legal transplants broadens the framework of comparativecorporate governance in three respects. First, it develops and applies a clearerframework for distinguishing between accepted and rejected legal transplants(based on Watson, 1974, Miller, 2003 and Mattei, 1994), thus refining the debateregarding convergence or divergence of corporate governance systems (e.g.Hansmann and Kraakman, 2004, and Branson, 2001). Second, the empiricalstudies demonstrate how imported regulations can be “localized” (Gillespie,2008a) by local regulators and/or “fitted” (adapted from Kanda and Milhaupt,2003) by other local actors. The studies show that fitting often precedes localizing.Third, the thesis ads to a growing body of research (e.g. Buck et al., 2004; Lutz,2004 and Collier and Zaman, 2005) emphasizing that convergence anddivergence are not necessarily two empirically or analytically distinguishableprocesses. Rather, depending on the perspective of the scholar, convergence anddivergence might refer to very similar – or even identical – processes.Finally, in focusing on the transplant process, this thesis offers a descriptionand analysis of the role played by various key actors in the Swedish corporategovernance system.