Abstract

We examine the extent to which Canadian firms complied with domestic corporate governance best practice guidelines and U.S. corporate governance law including the Sarbanes-Oxley Act. We ask whether voluntary compliance under both regimes occurred and whether cross-listing status and ownership concentration influenced firm behavior. Our results show increasing compliance rates with both regimes over a five-year period, although adoption rates for U.S. standards exceeded rates for Canadian best practices in later years, even for non-cross-listed firms. When given a choice in a best practice regime such as Canada’s, firms may look beyond domestic law in establishing their governance structures.

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