Abstract

The interdependence between compliance with norms and economic behavior can be highlighted by the effects of corporate governance codes. Their underlying comply or explain mechanism is first compared with the economic theory of corporate law. Diverging empirical studies on the effect of capital market pressure on compliance with codes leave room for different compliance mechanisms, which can be compared with the discussion on corporate social responsibility and its underlying business cases. The emerging common ground between economic motivation and social interests shows limits of the traditional rational actor model which can be further explored on the basis of fairness norms. Similar parallels and overlaps between market-driven self-interest and intrinsic motivation can be shown at the example of incentive effects of executive compensation. Its regulation in the German Stock Corporation Act is lacking any empirical foundation which is also true for the yet empirically unexplored compliance patterns in corporate governance.