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Purpose – This study examines country-level attributes that impact on Corporate Governance Disclosure (CGD) depending on the emerging market country's legal system.

Methodology/approach – We evaluate CGD level using 749 annual reports (year ended 2006) in 57 emerging market countries. We develop a CGD determinants model that compares differences in country level attributes between common law and civil law emerging market countries. Our model builds on a multiple regression and assumes interaction between the origin of the legal system and country-specific attributes.

Findings – Common law emerging markets have substantially higher levels of CGD than civil law ones. CGD is positively associated with the size of the capital market for the entire sample of emerging markets and for the sub-samples of common law and civil law countries. Law enforcement also has a strong positive influence on CGD in common law emerging countries, whereas it has no influence on CGD in civil law emerging countries.

Practical implications – Providing CGD levels for emerging markets helps to a better understanding of the corporate governance characteristics that prevail in each country. Decision makers (international investors, market authorities, standard setters, etc.) should be aware of how country level attributes may interact with the legal system (common law or civil law) to influence CGD.

Originality of the paper – This is one of the few papers to present evidence of the impact of country level attributes on CGD. This study contributes to identifying the attributes that influence CGD with reference to common law and civil law emerging markets.

The main objective of the present chapter is to address empirically the impacts of institutional distance (ID) on the multinationality level of firms from developing countries and interpret how the interaction between ID and firm resources affects firms from developing countries. Using data of firms from developing countries, we estimated an empirical cross-section model. The results show that while cultural distance was not found statistically significant, ID, on the other hand, was statistically significant. The higher the distance between home and host country, the higher the multinationality of firms from developing countries. We also found a positive and statistically significant correlation between intangible resource and multinationality, which suggests a tendency toward new pattern in the internationalization of firms from emerging economies.

The major objective of this study is to inspect the differences in the effect of derivatives on the stability between banks from emerging countries and those from recently developed countries.

According to the repercussions of the recent financial crisis, we divide the whole period into normal period “the pre-crisis period,” 2003–2006, and turbulent period “the crisis & post-crisis period,” 2007–2011. We use the Generalized Methods of Moments (GMM) estimator technique developed by Blundell and Bond (1998) to estimate our regressions.

Our main conclusions show that, in general, using derivatives by banks from emerging countries deteriorates their stability especially during the turbulent period, whereas, using derivatives do not weaken the stability of banks from recently developed countries. We deduce that banks from emerging countries are more destabilized by using derivatives than banks from recently developed countries.

This chapter discusses the regulatory challenges faced by financial institutions in emerging countries and it presents their specific features compared to financial institutions in developed countries. It offers a practical way of implementing regulatory changes while accounting for emerging countries’ specific features. Using a principle-based approach, this chapter builds on the recent regulatory developments in both developed and developing market economies. It relates these developments to industry best practices as well as the current state of the art in risk management and corporate governance. The findings show how the regulation of financial institutions in emerging countries differs from that in developed countries. Different approaches to mitigate the divergences and fill the gaps are discussed. Both regulators and financial institutions in emerging countries will find this chapter offers a practical point of view based on field and industry experience on how to interpret and apply regulations and adopt best practices in risk management in a way that accounts for emerging countries’ specific features.

This chapter attempts to analyze mainly the interactions between the implementation of inflation targeting (IT) policy and performance in the conduct of economic policies (fiscal and exchange rate) in emerging countries. More precisely, empirical studies conducted in this chapter aim to apprehend the feedback effect of this strategy of monetary policy on the budget deficit and volatility of exchange rate performance. This said, we consider the institutional framework as endogenous to IT and analyze the response of authorities to the adoption of this monetary regime. To do this, the retained methodological path in this chapter is an empirical way, based on the econometrics of panel data. First, our contribution to the existing literature is to evaluate the time-varying treatment effect of IT’s adoption on the budget deficit of emerging inflation targeters, using the propensity score matching approach. Our empirical analysis, conducted on a sample of 34 economies (13 IT and 21 non-IT economies) for the period from 1990 to 2010, show a significant impact of IT on the reduction of budget deficit in emerging countries having adopted this monetary policy framework. Therefore, we can say that the emerging government can benefit ex post and gradually from a decline in their public deficits. Retaining the same econometric approach and sample, we tried secondly to empirically examine whether the adoption of IT in emerging inflation targeters has been effectively translated by an increase in the nominal effective exchange rate volatility compared to non-IT countries. Our results show that this effect is decreasing and that this volatility is becoming less important after the shift to this monetary regime. We might suggest that this indirect and occasional intervention in the foreign exchange market can be made by fear of inflation rather than by fear of floating hence in most emerging countries that have adopted the IT strategy. Finally, we can say that our conclusions corroborate the literature of disciplining effects of IT regime on fiscal policy performance as well as the two controversial effects of IT on the nominal effective exchange rate volatility.

The possibility of institutional distance exerting an asymmetric effect on the entry strategies of multinational enterprises (MNEs) has attracted recent scholarly attention. In this context, we re-examine the relationship described by Hernandez and Nieto (2015) on the effect of the direction of regulatory institutional distance on MNEs’ choice of entry mode in host countries. We extend this research by (1) focussing on the context of emerging markets and (2) accounting for a greater variety of MNEs as well as institutions by including both large and small firms, and a larger set of home and host countries. In contrast to Hernandez and Nieto’s study, we find that, in the context of emerging markets, institutionally distant MNEs are more likely to choose the full-ownership mode when they originate from an institutionally stronger country in comparison to the host (emerging) country, and they are more likely to choose the joint-ownership mode when they originate from an institutionally weaker country. We discuss our findings with respect to Hernandez and Nieto’s study, which explores this relationship more generally (i.e. beyond emerging-market contexts), however in the context of small and medium enterprises.

Do multinational enterprises evolve differently in emerging and developed economies? Although one camp argues that emerging economy multinationals are different from their developed country counterparts owing to the underdeveloped institutions in their home countries, another camp counters that they are the same and the existing international business theories can fully explain their strategies. A third camp suggests a more nuanced perspective by finding value in both approaches. In this introductory chapter, we review this debate and offer new perspectives on how to extend existing theories by accounting for four specific aspects of the home country institutional environments of emerging economies: breadth, depth, timing, and duration of exposure to institutional development. We then discuss how the chapters in this volume extend these ideas.

The purpose of this study is to review a synthesis of International Financial Reporting Standards (IFRS) implementation in developing countries in an attempt to provide directions for future research. The in-depth analysis was performed with the use of the data analysis tool available in the Scopus databases. The study initially reviewed 145 papers and in particular 35 papers were analysed. Fifteen articles (43%) were published in seven journals including International Journal of Accounting, Critical Perspectives on Accounting, Advances in Accounting, International Journal of Accounting and Information Management, Asian Review of Accounting, Journal of Applied Accounting Research, and Asian Journal of Business and Accounting. Specifically, 89% citations were from 14 articles, but 9 (25%) articles were without any citations. Most of the studies focus on qualitative followed by quantitative, and very few studies were based on mixed methods. Researchers should focus on few areas for future research on IFRS implementation in developing countries including theory implications, policy prescriptions, and case of particular standard.

This study aims at investigating the effect of corporate social responsibility (CSR) and corporate social irresponsibility (CSI) on corporate financial performance (CFP) in firms headquartered in developed versus emerging countries. Drawing upon stakeholder and legitimacy perspectives, the authors argue that the CSR/CSI–CFP relationship differs depending on the home-countries’ level of economic development as this reflects their different sensitivity to sustainability. Indeed, as emerging economies are normally characterized by weaker regulations, they are likely to place lower pressures on companies for superior CSR practices. Therefore, the authors expect the effect of CSR on CFP to be more positive for firms headquartered in advanced than in emerging countries. At the same time, the authors propose a more negative relationship between CSI and CFP for firms headquartered in developed countries due to the higher overall sustainability expectations required to gain legitimacy. The empirical analyses, run on a sample of 1,971 publicly listed firms between 2010 and 2020 from developed and emerging economies, support the expectations, thus confirming that country-specific contextual factors do play a role in shaping both the positive and the negative impact of CSR and CSI on CFP, and that the reactions of stakeholders to responsible and irresponsible behavior are stronger when their sensitivity to sustainability is higher.