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State of Corporate Governance in Arab Countries: An Overview

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  • Harabi, Najib

Abstract

The purpose of this paper is to assess the state of corporate governance as a major factor affecting the growth performance of the private sector in MENA countries. For this purpose both country-specific assessments, carried out by World Bank-IMF teams (so-called ROSC’s assessments) and focus-group discussions that took place in four regional conferences have been synthesized. Strengths and weaknesses of corporate governance in selected Arab countries have been highlighted. One major key finding is that the legal and regulatory frameworks of the assessed Arab countries are largely compliant with the OECD Principles of corporate governance. However, practices are not. The difficulty of the assessments is to reflect properly the discrepancies between the letter of the law and compliance. It should be emphasized that the World Bank-IMF assessments focus on listed companies. No-listed firms, especially SME, family-owned firms and State-owned enterprises that make up to 98% of all firms, are not subject to assessments. Another key finding that emerged from our reviewing of the regional conferences on corporate governance is that corporate governance issues have not been ignored in public debates in the MENA region. Practitioners from capital markets, banks, public and private sector representatives and other civil society groups have accepted the need to address corporate governance reforms as one of the crucial topics affecting the economic growth and development of firms, industries and whole economies in their region. Several meetings and conferences at the national and regional level have taken place. Appropriate and up-to-date recommendations regarding corporate governance reform in the MENA region have been adopted in those events. It is now up to the decision makers at all levels to implement those recommendations

Suggested Citation

  • Harabi, Najib, 2007. "State of Corporate Governance in Arab Countries: An Overview," MPRA Paper 4566, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:4566
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    File URL: https://mpra.ub.uni-muenchen.de/4566/1/MPRA_paper_4566.pdf
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    References listed on IDEAS

    as
    1. Berglof, Erik & Claessens, Stijn, 2004. "Enforcement and Corporate Governance," Policy Research Working Paper Series 3409, The World Bank.
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    4. Capaul, Mierta & Fremond, Olivier, 2002. "The state of corporate governance - experience from country assessments," Policy Research Working Paper Series 2858, The World Bank.
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    10. Dyck, Alexander & Zingales, Luigi, 2002. "The Corporate Governance Role of the Media," CEPR Discussion Papers 3630, C.E.P.R. Discussion Papers.
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    More about this item

    Keywords

    Corporate Governance; Governance; state and business; business regulations; corporate finance; economic development; Arab countries; Middle East and North Africa;

    JEL classification:

    • G3 - Financial Economics - - Corporate Finance and Governance
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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