Corporate Governance Convergence Practice in Japan
Corporate governance convergence practice in Japan
Introduction
In recent years, there are a number of literatures with regard to the debatable and inevitable convergence in the corporate governance practices (Yoshikawa & Rasheed, 2009). In general, corporate governance convergence relate to the models of corporate governance, in which merge in practices and theoretical views especially at national or multinational level (West, 2009). West (2009) also stated that the completely convergence which represent the differences between various countries would disappear and a universal corporate governance would be used widely in the end. However, Hansmann and Kraakamn (2001) claimed that the corporate laws and practices are all converging to the ‘shareholder value maximization model’ nowadays (Hansmann & Kraakamn cited in Yoshikawa & Rasheed, 2009). On the other hand, a number of researches argued that the convergence is difficult to bring into the corporate governance (Bebchuk et al. cited in Yoshikawa & Rasheed, 2009). There were several studies implied that local economic institutions try to adjust themselves for adaptation of the foreign practices, yet Pieterse (1994) argued that this phenomenon would result in ‘hybridization’, rather than ‘convergence’ (Yoshikawa & Rasheed, 2009). Even though there are considerable controversies in the convergence of corporate governance, the huge changes which already occurred in corporate governance system in all major industries and emerging counties recently (Yoshikawa & Rasheed, 2009). In recent decades, Japanese corporate governance has been researched and discussed comprehensively (Yoshikawa & McGuire, 2008). In addition to that Japan is the third largest economy in the world and its GDP at $5.5 trillion accounts for 8.7% of global GDP (Nanto et al., 2011), Japanese corporate governance model differ from American and European models (Yoshikawa & McGuire, 2008; Aguilera & Cuervo-Cazurra, 2009; West, 2009).
Introduction
In recent years, there are a number of literatures with regard to the debatable and inevitable convergence in the corporate governance practices (Yoshikawa & Rasheed, 2009). In general, corporate governance convergence relate to the models of corporate governance, in which merge in practices and theoretical views especially at national or multinational level (West, 2009). West (2009) also stated that the completely convergence which represent the differences between various countries would disappear and a universal corporate governance would be used widely in the end. However, Hansmann and Kraakamn (2001) claimed that the corporate laws and practices are all converging to the ‘shareholder value maximization model’ nowadays (Hansmann & Kraakamn cited in Yoshikawa & Rasheed, 2009). On the other hand, a number of researches argued that the convergence is difficult to bring into the corporate governance (Bebchuk et al. cited in Yoshikawa & Rasheed, 2009). There were several studies implied that local economic institutions try to adjust themselves for adaptation of the foreign practices, yet Pieterse (1994) argued that this phenomenon would result in ‘hybridization’, rather than ‘convergence’ (Yoshikawa & Rasheed, 2009). Even though there are considerable controversies in the convergence of corporate governance, the huge changes which already occurred in corporate governance system in all major industries and emerging counties recently (Yoshikawa & Rasheed, 2009). In recent decades, Japanese corporate governance has been researched and discussed comprehensively (Yoshikawa & McGuire, 2008). In addition to that Japan is the third largest economy in the world and its GDP at $5.5 trillion accounts for 8.7% of global GDP (Nanto et al., 2011), Japanese corporate governance model differ from American and European models (Yoshikawa & McGuire, 2008; Aguilera & Cuervo-Cazurra, 2009; West, 2009).
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