The enhancement of accountability and transparency in corporate governance framework in Saudi Arabia

This thesis evaluates the Saudi Arabia’s corporate governance accountability in listed companies by examining core issues such as shareholders’ accountability, transparency and the directors’ accountabilities and duties. In addition, the study assesses the legal bodies responsible for enacting Saudi corporate governance regulations and supervising their implementation. Furthermore, the thesis attempts to determine whether the responsibilities and duties of the board members are clearly defined and whether board is sufficiently obligated to disclose relevant information. This thesis applies a comparative methodology using library-based information such as regulations, codes, cases, books, journals and articles in order to accomplish its aims. Measures were taken to compare the new developing corporate governance approach of Saudi Arabia to the models of the United Kingdom and the United States.

Some barriers exist that have slowed the improvement of Saudi corporate governance practice. Saudi government-owned firms are influenced by political choices. The dominance of government ownership may not enhance corporations’ accountabilities. Family firms also have a significant influence on the Saudi corporate governance. In addition, Saudi Arabian shareholders in the equity market tend to be passive, and rarely coordinate with each other. Moreover, the Saudi approach is still experiencing some ambiguity and omission of needed corporate governance framework to identify board duties. The framework standard of transparency and the level of disclosure are very low and inadequate.

A key aim of this research is to assist regulators in their efforts to promote corporate regulatory framework and identify additional alternative optimal measures to enhance the accountability of Saudi corporate governance. Besides, the literature on corporate governance in Saudi Arabia is minimal and inadequately researched. Thus, this research project aims to bridge the gap in the field of the corporate governance regulations with the intention of extending the current literature and to find solutions to the above issues with the objective to increase the enhancement of fairness, accountability and transparency in Saudi corporations.