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The objective of this research is to develop a conceptual framework based on classical institutional theory to explain the key drivers or mechanisms behind the adoption and use of the business practice of benchmarking. The paper commences with the development of a conceptual view of benchmarking placing the four dimensions of benchmarking on a continuum from passive to active actions that improve performance. This is followed by the development of a construct for investigation using institutional theory through its major components, organisational isomorphism and organisational legitimacy and their drivers. Overlaying the conceptual view of benchmarking and the institutional theory construct a conceptual crossover is developed identifying the specific drivers of institutional theory and their relevant benchmarking dimension. In so doing the study provides a base that creates meaning and significance through linking the subjective and objective realms of theory and practice. This, in part, answers the critics who argue that managerial accounting research focuses on the description of business practices and has failed in developing appropriate theories. It also provides a model to test the institutional theory/benchmarking relationships.