Contrary to what good parents have long taught their children, itâs now acceptable in corporate governance to say âeveryone else is doing it, you should too.â Advocates of so-called good governance urge companies to take specific actions because they âlag behind their peersâ on some favored practice.Â
This is new. A generation ago, the norm in corporate governance was to recognize differences among companies â the need to tailor governance to fit needs, to shun cookie-cutter approaches. In recent years, however, the norm has veered to a universal expectation that all boards should follow identical guidelines, usually anointed as âbest practicesâ or âgold standards.â