Corporate governance practices, ownership structure, and corporate performance in the GCC countries

Abed Al Nasser Abdallah, Ahmad K. Ismail

Research output: Contribution to journalArticlepeer-review

94 Citations (Scopus)

Abstract

This study is motivated by highly concentrated ownership, the relatively large government stake in listed firms in the GCC (Gulf Cooperative Council) region, and the rapid stock market development and developing investor protection environment. The results point to heterogeneity in governance quality across exchanges. For the first time, we find that the positive relationship between governance quality and firm performance is maintained and is stronger at low levels of concentrated ownership. More interestingly, we find that the relationship between governance and firm performance is an increasing function of dispersed ownership and that the value addition of good governance is not necessarily maintained at high levels of ownership concentration. Furthermore, such a relationship reaches its highest level when the government or local corporations are the firm's major shareholders.

Original languageEnglish
Pages (from-to)98-115
Number of pages18
JournalJournal of International Financial Markets, Institutions and Money
Volume46
DOIs
Publication statusPublished - Jan 1 2017
Externally publishedYes

Keywords

  • Corporate governance
  • Financial disclosure
  • Ownership structure
  • Performance
  • Transparency

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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