Corporate governance in Kuwait: An analysis in terms of grounded theory

Adaptations of CSR in the Context of Globalization the Case of the GCC

“…The government is attending to this issue through plans of economic diversification; a privatization plan was put in place to shift dependence from the oil and gas sector. However, the state legal framework and enforcement is weak; there are no CG laws put in place and company regulations lack any reference to stakeholder's rights [28]. Due to its legal context, it is up to the firm to participate in socially responsible activities such as human and labor rights.…”

“…A study on CG practices in businesses in Kuwait suggests the low level of development in that field with a salient lack of accountability, disclosure, shareholders' and stakeholders' rights. While some companies studied had assigned a board committee, others do not even have a selected board committee to look over governance issues [28]. There is no legal framework for social responsibility issues; however, some large sized companies exhibit some kind of participation in CSR practices [28].…”

Ownership concentration, ownership composition and the performance of the Kuwaiti listed non-financial firms

“…shareholders, boards of directors, and financial policies)and ineffective external governance mechanisms (e.g., incentive contracts, legal protections, takeovers, and proxy contests) (Al- Saidi and Al-Shammari, 2012). Shareholders' interests receive more consideration than stakeholders' interests, and Kuwait's listed firms rely heavily on either banks or the government to raise investment funds, representing the lowest quality of law enforcement (Al-Saidi and Al-Shammari, 2012).…”

“…Kuwait's corporate governance system largely follows the insider (bank-based) system; it has a high concentration of ownership by large shareholders, few independent directors, few audit committees, weak protections for investors, and limited disclosure (Al- Saidi and Al-Shammari, 2012;Saidi and Kumar, 2008). Listed firms are also small and more closely held while performance-related pay and hostile takeovers are less common; firm boards are owner and family dominated (Al-Shammari and Al-Sultan, 2009).…”

“…Xu and Wang (1997) found high ownership concentration in Chinese listed firms and ownership concentration in the hands of government, institutions, and individuals. In the case of Kuwait, pyramid ownership structure with shareholders (owners) is well-known where large shareholders (firms or families) is high; in several cases, one large shareholder owned several listed firms (Al- Saidi and Al-Shammari, 2012). Therefore, recent studies have clearly found that ownership concentration is very common across the world.…”