Global Forces and Corporate Reforms in South Korea

Abstract

This article attempts to examine the international forces at work in the transformation of corporate governance in South Korea. In so doing, it provides a corrective to existing analyses that pay inadequate attention to how internationalization shapes domestic decisions about corporate reforms. The article explores the causal impact of four factors — overseas reforms and competition, global market constraints, transnational norms, and internalization of external pressures. It posits that these different forms of internationalization have created powerful forces for sustained corporate reforms in South Korea since the Asian financial crisis of 1997—8. While they have not preordained convergence toward the Anglo-American model of capitalism, they have overwhelmed political resistance and institutional inertia to result in an important shift in the architecture of South Korean corporate governance.