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Corporate governance myths: Comments on Armstrong, Guay, and Weber

  • Brickley, James A.
  • Zimmerman, Jerold L.
Registered author(s):

    This paper argues that academics, politicians, and the media have six commonly held but misguided beliefs about corporate governance. While Armstrong et al. (2010) discuss some of these misconceptions, a wider recognition that these beliefs are actually "myths" is important. They include: (1) a common definition of "corporate governance" exists; (2) a useful distinction is "internal" versus "external" governance mechanisms; (3) outside directors perform two separable roles: to advise and monitor managers; (4) research has identified "good" and "bad" governance practices; (5) a "good" governance index can be constructed; and (6) corporate governance "best practices" can be deduced from peer data.

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    File URL: http://www.sciencedirect.com/science/article/B6V87-518TY4M-2/2/02e4c85e6465f91143002ef7651113ef
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    Article provided by Elsevier in its journal Journal of Accounting and Economics.

    Volume (Year): 50 (2010)
    Issue (Month): 2-3 (December)
    Pages: 235-245

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    Handle: RePEc:eee:jaecon:v:50:y:2010:i:2-3:p:235-245
    Contact details of provider: Web page: http://www.elsevier.com/locate/jae

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