THE IMPACT OF CORPORATE GOVERNANCE ON ATTRACTING FOREIGN INVESTMENT IN SAUDI SHAREGOLDING COMPANIES (INDUSTRIAL SECTOR)
DOI:
https://doi.org/10.46827/ejefr.v0i0.723Palabras clave:
corporate governance, foreign investments, shareholding companies, creative accountingResumen
The main objective of this research is to investigate the impact of corporate governance on foreign investment. Also, it aims to check whether there is a relationship between corporate governance on foreign investment. The researcher applied the quantitative approach, using the questionnaire to collect the required data. The participants of the study were financial managers and their representatives in Saudi Arabian shareholding companies. The collected responses were only (60) responses. The Statistical Program for Social Sciences (SPSS) was used for data analysis. The study revealed that corporate governance contributes to a reduction in creative accounting practices and thus increases the confidence of foreign investors. The study found that there is a direct association between the application of Corporate Governance and the attraction of foreign investment to the domestic economy in Saudi Arabia. The study recommended that corporate governance not only sets up a system of institutions that govern the relationship between owners, investors, creditors, and managers but also it would contribute in the creation of a good investment environment that attract foreign investment. The obligation to apply corporate governance’ principles is considered one of the essential methods that provide foreign investors with a high level of trust.
JEL: G30, G34, O16
Article visualizations:
Referencias
Alhayali, Sindhi, Jaafar, Laith (2015). The role of governance in supporting investment decision, applied study on a sample of companies in the Iraqi market for securities. Journal of Economics and Finance, No. 00, pp. 10-26, 2015.
Asiri, Abdullah Ali (2013). Corporate Governance Disclosure in Saudi Arabia: An Empirical Study. Journal of King Abdulaziz University: Economics & Administration. 2013, Vol. 27, Issue 1, p95-130. 36p.
Bilal, Malakso; Maryam, Kabsh (2015). Foreign direct investment and its impact on economic growth in Algeria - a standard study for the period (1990-2010). REMAH Journal. Aug 2015, Issue 15B, p8-32. 25p.
Haldar, A. & Rao, S. (2011). Portfolio Flows and Governance in Corporate India. IUP Journal of Corporate Governance, 04/2012, Volume 11, Issue 2.
Hawas, Amira; Tse, Chin-Bun (2016). How Corporate Governance Affects Investment Decisions of Major Shareholders in UK Listed Companies: Has the Recent Credit Crunch Changed the Game. Journal of Accounting, Auditing & Finance 2016, Vol. 31(1) 100–133.
Jarirah, Talal Suleiman; Suleiman Hussein, Al-Bashtawi; Hayasat, Hamdan Mohammed (2015). The Impact of Governance Accounting Mechanisms on the Limitation of Creative Accounting Practices, From Viewpoints of Public Industrial Shareholding Companies in Jordan and the External Auditors. Jordan Journal of Business Administration. 2015, Vol. 11 Issue 2, p317-347.
Kalbouna, Ahmed Youssef (2016). The Impact of Corporate Governance Guidance Rules on the Quality of Accounting Information in the Jordanian Public Shareholding Industrial Companies. Dirasat: Administrative Sciences. 2016, Vol. 43 Issue 2, p859-874. 16p.
Kumari, P.; Sri Ram, P. (2017). A study on foreign investment & its impact on growth of food & agriculture sector in India. International journal of multidisciplinary research and development, volume no. 8 (2017), issue no. 07.
Saudi Arabian Vision 2030 website (2018). Governance. [online] access on Feb 2108 at: http://vision2030.gov.sa/en/node/259
Shahid, Muhammad; Shah, Mahmood; Parveen, Farhat; Mehmood, Rana Khalid (2016). Governance and current econometric effect of macro-economic variables on foreign direct investment in Pakistan: an empirical study. Sci. Int. (Lahore), 28(3), 2973-2978, 2016.
Talamo, G. (2011). Corporate governance and capital flows. Corporate Governance: The international journal of business in society, 06/2011, Volume 11, Issue 3.
