Abstract
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Implementation of principles of the Codes on Corporate Governance (CCG) is aimed at minimizing
agency conflicts and corporate governance problems in the listed firms. It is, however, observed that
such conflicts and problems occur frequently despite the rapid implementation of the CCG by listed
firms. We developed a theoretical framework to understand why do firms accept and implement the
voluntary CCG principles and what type of behaviours could be expected from top management. We
argue that ccorporations implement the principles and provisions of the voluntary CCG due to (a) their
compliance with societal norms and ethics,(b)coercive isomorphic behavior of managers, (c) the need
for basic integration and adaptive and mimetic behavior of managers, (d) specific needs of
corporations, and (e).strategic vs. self- focused behavior of CEOs and non-executive directors (NEDs).