English:
In today´s business world corporate governance has become one of the
most discussed and most important matters. Corporate governance
criteria have been put right in the middle of investment decisions -
especially in emerging markets. In addition to that, a series of events like
business scandals, financial crises or business failures in the last 20 years
has made corporate governance a key point in the business community in
emerging markets, developing countries and economies in transition.
There exists no general definition for the term corporate governance.
Basically it can be viewed as a set of principles and rules by which a
company is directed and controlled. Many countries have developed good
corporate governance principles to improve the relationship between the
shareholders of a company and the management. Factors like financial
disclosure, more rights for shareholders and independent boards are
crucial for investors who are looking for a stable growth of companies.
Countries in the MENA region have put the implementation of such sound
corporate governance codes in the middle of their agenda. Their aim is to
create better economies and consequently a more attractive investment
climate for possible investors in the future.
This thesis tries to give the reader an insight into today´s state of
corporate governance in the Middle East and North Africa countries. The
discussion is based on a survey which has been undertaken by the
Hawkamah Institute for corporate governance in Dubai which focuses on
the establishment of good corporate governance codes in this region.
Table of Contents
1. Introduction
1.1. What is corporate governance?
1.2. Who benefits from good corporate governance?
2. MENA countries and their recent development
2.1. Corporate governance in the MENA countries - an overview
2.2. Hawkamah Institute for Corporate Governance in Arab countries
3. Implementing corporate governance: practice vs. theory
3.1. The survey
3.2. General findings
3.3. Still at the beginning
3.4. Board of Directors
3.4.1. Board Structure
3.4.2. Board size
3.4.3. Establishing board committees
3.4.4. Board meetings
3.4.5. One director, one board? Multiple Directorships
3.5. Managerial Labor Market
3.6. Executive Compensation
3.7. Risk Management
3.7.1. Internal controls
3.7.2. Internal audit
3.7.3. External audit
3.7.4. Audit committee
3.8. Transparency & Disclosure
3.8.1. What is being disclosed?
3.8.2. Any barriers preventing disclosure?
3.9. Shareholder rights
4. Family power in the MENA region
5. Women on boards
6. Conclusion
Objectives and Topics
This thesis examines the current state of corporate governance practices within the Middle East and North Africa (MENA) region. It aims to analyze how listed companies and banks in these countries implement governance principles, identify existing challenges in transparency and disclosure, and evaluate the role of institutional frameworks and family ownership in corporate performance.
- The role and definition of corporate governance in emerging markets.
- Implementation practices concerning boards of directors and risk management.
- Transparency, financial disclosure, and shareholder rights in the MENA region.
- The impact of family control and ownership structures on corporate governance.
- Barriers to the effective adoption of international governance standards.
Excerpt from the book
1.1. What is corporate governance?
In today´s business world we find many different definitions for the term corporate governance. The two most named and used ones in literature describe the term in a very detailed, and brief way. The first definition comes from the Organisation for Economic Co-operation and Development (OECD) and is defined in the following way: „Corporate governance is the system by which business corporations are directed and controlled. The corporate governance structure specifies the distribution of rights and responsiblities among different participants in the corporation, such as, the boards, managers, shareholders, and other stakeholders, and spells out the rules and procedures for making decisions on corporate affairs. By doing this, it also provides the structure through which the company objectives are set, and the means of attaining those objectives and monitoring performance.“1 The seond one is shorter and is briefly compared to the first one. „Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment.“2 As we can see from these two definitions, corporate governance can be seen as a set of processes, customs, policies and laws which determine how a corporation is directed and controlled.
Summary of Chapters
1. Introduction: Defines corporate governance and highlights its importance in protecting stakeholders and ensuring corporate stability.
2. MENA countries and their recent development: Provides an overview of the regional economic landscape and the role of the Hawkamah Institute in promoting governance reforms.
3. Implementing corporate governance: practice vs. theory: Analyzes survey data regarding board structures, risk management, transparency, and compensation within MENA firms.
4. Family power in the MENA region: Discusses the prevalence of family-controlled businesses and the impact of family ownership on corporate strategy and governance.
5. Women on boards: Examines the participation of women in leadership roles within the regional business sector, noting discrepancies influenced by social and religious factors.
6. Conclusion: Summarizes the findings, emphasizing that while governance awareness is growing, the region is still in the early stages of full implementation.
Keywords
Corporate Governance, MENA Region, Hawkamah Institute, Board of Directors, Transparency, Disclosure, Financial Performance, Risk Management, Internal Audit, Family-Owned Enterprises, Shareholder Rights, Emerging Markets, Corporate Strategy, Incentive Compensation, Minority Protection
Frequently Asked Questions
What is the primary focus of this thesis?
The work focuses on the current implementation of corporate governance practices in companies and banks across the Middle East and North Africa (MENA) region.
What are the central thematic areas of the research?
The central themes include the structure of boards of directors, risk management mechanisms, transparency and disclosure policies, shareholder rights, and the influence of family-owned businesses.
What is the primary goal or research question?
The objective is to provide an insight into the state of corporate governance in the MENA region and to assess how effectively these countries are transitioning toward international governance standards.
Which scientific methodology is used?
The thesis is based on an analysis of primary data from a survey conducted by the Hawkamah Institute in Dubai, supplemented by a review of relevant economic literature and corporate governance theories.
What is covered in the main section of the paper?
The main section covers detailed aspects such as board composition, board meeting frequencies, the managerial labor market, executive compensation, internal controls, and auditing procedures.
Which keywords characterize this work?
Key terms include Corporate Governance, MENA Region, Transparency, Disclosure, Board of Directors, Family-Owned Enterprises, and Shareholder Rights.
How does the author define the role of family ownership?
The author discusses how family-controlled firms are prevalent in the Gulf region and suggests that while family involvement can provide stability and reliability, it also creates challenges regarding independent board oversight and succession planning.
Why is financial disclosure highlighted as a critical element?
Financial disclosure is deemed essential because it is a key driver for investor confidence; the author illustrates this using the Enron scandal as an example of how a lack of transparency can lead to catastrophic business failure.
- Arbeit zitieren
- Georg Binder (Autor:in), 2009, Corporate Governance in Arab Countries, München, GRIN Verlag, https://www.hausarbeiten.de/document/175194
