Starting from the second half of the 1990s, the new wave of the corporate governance literature has developed an interesting sub-stream concerning the privatization process in the post-communist transition. This chapter will criticize this literature from two angles. First, many authors seem to pay little attention to the definition of their own key terms. It sets out the theoretical background and concludes that corporate governance as usually understood is rapidly becoming irrelevant in transition economies. The chapter examines this rather provocative statement from an East European perspective. It argues that privatization should be assessed from the viewpoint of the types of investors that dominate the markets in transition economies. The literature often assumes that the typical investors are US-type managed funds, which is not the case. The chapter enumerates the differences between the small Central and East European markets and the potentially vast Russian and Chinese markets.