Corporate Governance Practices in Qatar - Essay Example

Corporate Governance Corporate Governance Corporate governance refers to how companies organize themselves, make decisions and communicate with shareholders both locally and internationally. It involves how executives and boards are chosen, what responsibilities and mandate executives and boards have, and the voting right of shareholders to facilitate corporate decisions. The issues of corporate governance are paramount to multinational companies. They promote good decision-making, business practices and opportunities for investors to warrant the integrity of their investment.

The corporate governance, practices and regulations of multinational companies tend to be more sophisticated than local companies. Governments are creating new regulatory frameworks to improve corporate governance of companies (Adamson, 22- 03-2011). Multinational companies are evolving and changing corporate governance to meet benchmarks and the basic requirements required by investors in making investment decisions. Companies are focusing on best practices such as risk management in order to have good corporate governance.

Companies are emphasizing the management of their reputations to improve the perception of local and global community about their images.The drive to implement good corporate governance and the financial crisis in Qatar have led directors and officers of multinational companies to increase the awareness of their responsibilities. The executives are taking companies’ failure as personal liability. In Qatar, Investors are holding executives and boards responsible for unsatisfactory performance.

Companies are under thorough scrutiny especially on managerial actions. Executives are aware of risks facing them. Therefore, they act to limit personal liability. The Arabic companies are embracing a more pragmatic and less litigious approach in their corporate governance to serve the international community. The Qatar government is creating new frameworks for practices and regulations that favour multinational companies. The aim of the government of Qatar to provide real business environments to attract both foreign and local investors.

The greater accountability for boards and executives actions has made companies prioritize shareholders’ interests. It is because shareholders and financial regulators put a scrutiny on issues of corporate governance. Multinational companies are now taking a proactive approach in risk management to protect executives and boards’ members. These companies are improving the standards of corporate governance to march the international standards (Alexander Blom, 16-10-2011). Qatar is drafting new companies law that will see the corporate governance rules improve.

Qatar is developing regulatory bodies to implement rigorous regulations to ensure good corporate governance. The financial regulators impose extremely tight regulations on multinational companies in order to ensure interests of investors and shareholders are prioritised. The country freezes the accounts of individuals who embezzle and cause disputes in the business affairs of these companies. Qatar also adopts laws and regulations in other states such as the Bribery Act of UK to good corporate governance.

The government of Qatar is strengthening internal controls to ensure multinational companies embrace both external and internal requirements. There is an upsurge in regulatory related claims as the Qatar financial regulators and governments departments try to bring tight discipline into the ongoing activities of these multinational companies. The government wants these companies to bring more investors and generate more revenues into the country. It also wants them adopt the intentional standards and reach the multinational level of operation (Brennan, L.2013.p.304).Reference List Adamson, R.

, 22- 03-2011. Corporate Governance, Risk Management and Corporate Social Responsibility in Emerging Markets: A Symbiotic Relationship. [Online] Available at: http://beedie.sfu.ca/corporate-governance-blog/2011/03/corporate-governance-risk-management-and-corporate-social-responsibility-in-emerging-markets-a-symbiotic-relationship/ [Accessed 05 06 2015].Alexander Blom, I. S. R. W., 16-10-2011. Personal risks are facing board members in the Middle East. [Online] Available at: http://www.financierworldwide.

com/personal-risks-facing-board-members-in-the-middle-east/#.U5CXdnJdU0E[Accessed 05 06 2015].BRENNAN, L. (2013). Enacting globalization: multidisciplinary perspectives on international integration. http://www.palgraveconnect.com/doifinder/10.1057/9781137361943.