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Cultural Dimensions, Ethical Sensitivity, and Corporate Governance

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  • Alex Chan

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  • Hoi Cheung

    ()

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    Abstract

    The economic globalization process has integrated different competitive markets and pushes firms in different countries to improve their managerial and operational efficiencies. Given the recent empirical evidence for the benefits to firms and stakeholders of good corporate governance (CG) practice, it is expected that good CG practice would be a common strategy for firms in different countries to meet the increasingly intense competition; however, this is not the case. This study examines the differences in CG practices in firms across different countries using the concept of ethical sensitivity. Through the regression analysis of 271 firms in 12 countries and regions, it is found that Hofstede’s cultural dimensions can explain the differences in CG practices. Furthermore, the results demonstrate the influence of culture on ethical sensitivity, which eventually determines the CG practices in different regions. Copyright The Author(s) 2012

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    Bibliographic Info

    Article provided by Springer in its journal Journal of Business Ethics.

    Volume (Year): 110 (2012)
    Issue (Month): 1 (September)
    Pages: 45-59

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    Handle: RePEc:kap:jbuset:v:110:y:2012:i:1:p:45-59

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    Web page: http://www.springerlink.com/link.asp?id=100281

    Related research

    Keywords: Ethical sensitivity; Corporate governance; Cultural dimensions; Emerging markets; Behavioral finance;

    References

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    Cited by:
    1. Carlos Sanchez-Runde & Luciara Nardon & Richard Steers, 2013. "The Cultural Roots of Ethical Conflicts in Global Business," Journal of Business Ethics, Springer, Springer, vol. 116(4), pages 689-701, September.

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