Abstract
This article examines the role of corporate governance regulations in the emerging market economies giving a critical analysis of the example of a BRICs country - Brazil. The article presents a study of the theoretical aspects of corporate governance regulations, how they work and what effect they have on the economy of a developing country. The study is motivated by the question how corporate governance can benefit foreign investment into an emerging market country. The findings of the study are illustrated by the Brazilian example of how the corporate governance regulations were introduced into company practice in the country and what effect they had on the economic situation. This analysed example shows what problems were identified in the process and various ways to overcome them to provide more confidence to the foreign capital investment into the country.
Highlights
In the recent years there has been noted a substantial growth in corporate governance development at the global level, and this trend is especially strong in the emerging economies
The authors will focus on the analysis of the system of corporate governance from the perspective of the theoretical framework and by providing an example of how corporate governance system is represented in an emerging economy of one the BRICs countries – Brazil
Analysing the state of corporate governance regulation at most emerging market countries, it is safe to say that it is characterized by corporate structures with various levels of ownership and inside shareholders such as minority shareholders (Gerlach 1992; Heugens et al 2009)
Summary
In the recent years there has been noted a substantial growth in corporate governance development at the global level, and this trend is especially strong in the emerging economies. The BRICs countries, which represent developing countries with one of the highest growth rates, are showing an increasing interest in the promotion of the use of the corporate governance codes by the companies, aiming to protect the interests of the shareholders, the stakeholders and the economy in general. International organisations such as the Organization for Economic Cooperation and Development (OECD) have worked out internationally acceptable standards of corporate governance to facilitate the process of the creation of the corporate governance codes (Solomon, 2010).
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