Corporate Governance Reform in an Emerging Economy: Organisational Change or Window Dressing of Compliance

This paper examines organisational change partly as window dressing or compliance when corporate governance reforms were introduced to varying listed companies in a developing country. Specifically, we examine whether the listed companies transformed their roles including those of board members; what the nature of the changes were; what factors hindered governance related development initiatives and how the companies and their members reacted to the reforms. By using content analysis between 2007 and 2017, this study observed that the listed companies of Bangladesh tended to overstate compliance statements to manage their impressions to their stakeholders. After the reform in 2012, requiring more independent directors into the board and external certification of compliance statements, however, it was found that the extent of window dressing in compliance statements declined considerably. Government firms were found to make more proportionate overstatements compared to family, non-family and foreign companies. In fine, we found that the companies’ developmental efforts were challenged by the existing formal legal environment and regulatory pressures