Impact of Corporate Governance on Business Performance - Dissertation Example

Download file to see previous pages The adoption of corporate governance measures is generally accepted as a means of developing shareholder trust and confidence in the midst of economic shocks and volatile financial markets. The need for information is paramount in assessing the risk to investors and to the business. In Saudi Arabia, where family-owned and controlled corporations proliferate, the urgency to adopt corporate governance measures is paramount to assuage the fears of the global investing market.

The study determined that nearly all the indicators for measuring corporate governance do not significantly influence the financial performance of the 90 Saudi-listed firms that comprised the research sample. The fact that many of these firms are owned by family groups is a possible explanation for this lack of significant relationships. Of the factors measured, only majority shareholder concentration proved to significantly influence the financial performance of Saudi firms as measured by the return on equity.

Chapter 1: Introduction
1.1 Overview
The introductory chapter presents the research problem within the context in which it is conceptualized. The historical background is first related in order to explain the problem’s development and the need to address it. The research problem is objectively stated, followed by the research objectives and questions, which would lead to the principal conclusion in answer to the problem statement. The major terms are thereafter described as they are operationally used in the dissertation to bring clarity to the problem, objectives, and questions. Following that is an elaboration of the scope and delimitations, to create focus and emphasis on the major issues and exclude the peripheral concerns that do not contribute to the problem’s solution. The rationale of the study is explained to specify the significance of the eventual conclusion. Lastly, the conceptual framework that will guide the inquiry is identified to specify the theoretical foundations that support the dissertation.

1.2 Background of the study
The Kingdom of Saudi Arabia as we know it today came into being on September 23, 1932, with the unification of Hejaz and Najd upon the royal decree of King Abdulaziz Al-Saud (Etheredge, 2011, p. 56); however, the history and culture of its people go back thousands of years, when largely nomadic tribes of peoples who traversed the desert to reach the mountain valleys and oases. Since the discovery of oil, however, the Kingdom has rapidly undergone a remarkable transformation; today, it is a modern and sophisticated state and a nation regarded as a significant player in global affairs (Royal Embassy of Saudi Arabia, 2012).

As a global economic power, Saudi Arabia is called upon to assume a position of leadership in the community of nations. ...Download file to see next pages Read More