An Introduction to Adaptive Efficiency and Corporate Governance

The issue of corporate governance has gained unprecedented attention in the international community after the ravages of the Asian financial crisis. In recent years, laying down more sophisticated governance guidelines has become a vibrant campaign with the favor and participation of various interested groups: academics, media, regulatory authorities, legislatures, companies, institutional investors, international organizations, intermediaries, etc. For instance, the government of South Korea has taken a series of steps to reform the corporate governance of Chaebol since 1998. The Organization of Economic Cooperation and Development (OECD) also released “OECD Principles of Corporate Governance” in 1999 in order to provide member and non-member countries with specific guidelines to improve the legal, institutional, and regulatory frameworks that underpin corporate governance. In addition, intermediaries, such as McKinsey & Company, are also urging the overhaul of corporate governance in emerging and transitional economies.