Macroeconomic sources of vulnerability to crisis in East Asia have been widely cited. However, several studies have identified microeconomic weaknesses stemming from poor corporate governance and corporate finance practices as a leading cause of the crisis. Many of these studies have assumed that all crisis affected East Asian economies shared common key characteristics in their corporate environment, leading to poor corporate performance. This paper aims to establish if microeconomic weaknesses stemming from corporate sector performance contributed to Malaysia’s vulnerability to the crisis. In doing so, recent literature on the legal-based view that stresses the importance of the legal and corporate governance environment is incorporated. Further, Malaysia’s performance was compared to the economies which were severely affected by the crisis, i.e. Thailand, Korea and Indonesia, to gain some insight on the extent of similarities that existed among firms in these countries in terms of their corporate financing patterns and performance prior to the crisis.