Corporate Governance Standards in Saudi Financial Sector: Achievements and Challenges
Abdullah Wahtan Alkahtani
Corporate governance is a relatively novel in Saudi Arabia. It has just been recognized following the market crash that hit the Saudi financial sector in 2006 and resulted in heavy losses of many Saudi people wealth. Following the recent challenges showed after the establishment of the Capital Market Authority (CMA), this article examined corporate governance mechanisms based on the recent reforms involved in enacting Corporate Governance Regulations (CGR), Capital Market Law (CML) and new Company Law (CL), as well as it identified the strengths and shortcomings points associated with the early developments in the Saudi legal system. When looking at the Saudi financial sector, the report issued by the World Bank on the observance of standards and codes across Saudi Arabia in 1990 can be seen as a central to analysing the Corporate Governance Regulations (CGR) in Saudi Arabia. This article discovered that governance mechanisms applied in Saudi Arabia are extensive and cover a broad area of corporate governance principles. Furthermore, because of negligence and dearth of studies in this area, it is expected that this article would contribute to enhance literature on corporate governance studies in Saudi Arabian library.
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