Computational studies exploring the extent to which differences in proximal axial ligands modulate structure, spectra, and function of peroxidases have been performed. To this end, three heme models of compound I were characterized differing only in the axial ligand. The axial ligands considered were L = ImH , Im^-^, that are alternative protonation models for a typical peroxidase with an imidazole ligand such as horseradish peroxidase (HRP-I), and L = SCH - that is a model for an unsual peroxidase, chloroperoxidase (CPO-I). Density functional calculations (DFTs) were performed to determine the optimized geometries and electronic structure of each of these three species. Their electronic spectra were also calculated at the DFT optimized geometries, using the INDO/S/CI method. The results of these studies led to the following conclusions: (1) the presence of the nearby Asp in a typical peroxidase does indeed decrease the energy required to deprotonate the imidazole making the two forms essentially degenerate, (2) neither the state of protonation of the imidazole ligand nor the change in axial ligand from an imidazole in typical peroxidases such as HRP to a mercaptide in CPO significantly alters the characteristics of the lowest energy spin state or the electronic structure of compound I in a way that can obviously affect function, (3) both the Im^-^and ImH forms of the peroxidase compound I (HRP-I) lead to the same dramatic reduction in intensity relative to the ferric resting form observed experimentally. However, only in the ImH form of HRP-I does the calculated relative shift of one component of the Soret bands relative to CPO-I agree with that observed in the transient spectra of HRP-I compared to CPO-I. These results taken together strongly indicate that factors other than the nature of the proximal axial ligand are the main determinants of function.