Social Business Environment of Saudi Arabia - Research Proposal

Introduction

The paper aims to define the major effects of corporate governance with the use of big data obtained from companies in Saudi Arabia. Organizations involved in financing decisions need to follow the policies and procedures of corporate governance. The piece will thus discuss the issue provided by the topic in determining the debt to equity ratio of most companies that were sampled.

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Overview of the Current Research

Investigations are conducted on the implications of big data to show the compliance of companies in Saudi Arabia considering the corporate governance rations. The BCMA (Board of Capital Market Authority) in Saudi Arabia issues the requirements for corporate governance. The board also has data about the impact of earnings management for companies. Researchers suggest most of the companies are driven by the structure of their finances to make decisions regarding their stake which needs to reflect the corporate governance (Al-Thuneibat et al. 2016). From the list of companies that research was done, ownership concentration and corporate governance reporting are the chief drivers of structure decisions in the business environment of US (Du, & Dai, 2005). The board size was not a key driver to capital structure maybe because of the weak requirements for board management. The size of the board ensures good decision making for the structure of finances (Ramady, 2010). The significant implication of the data is that there is an increase in debt levels for financing activities rather than equity.

Methodology

The research will include the model of using questionnaires that will be disseminated to many research companies. The questions will be both closed and open-ended because there is a need to collect specific and general information concerning compliance of these companies with the requirements of corporate governance. More information will be retrieved from online sources and websites of these companies. Big data will be available from the records of the BCMA situated in Saudi Arabia. There will be the use of a multiple regression model that examined the association of decisions that companies make with the mechanisms of corporate governance for the sample companies. Generally, the research demonstrates the different dimensions of corporate governance and its effects concerning on the ration of debt to equity.

Resource Requirements

The research will require a lot of traveling to the sample companies to issue questionnaires to individuals during the actual study. We need a lot of questionnaires at the methodology stage.

Expectations of Research Results

The expectations of the research are that there is a high ratio of debt to equity which means that the companies use debts as finance for the activities instead of capital (La Rocca, 2007). The corporate governance of Saudi Arabia's market structure implies a lot on the decisions that companies make.

References

Al-Thuneibat, A. A., Al-Angari, H. A., & Al-Saad, S. A. (2016). The effect of corporate governance mechanisms on earnings management: Evidence from Saudi Arabia. Review of International Business and Strategy, 26(1), 2-32.

Du, J., & Dai, Y. (2005). Ultimate corporate ownership structures and capital structures: Evidence from East Asian economies. Corporate Governance: An International Review, 13(1), 60-71.

La Rocca, M. (2007). The influence of corporate governance on the relation between capital structure and value. Corporate Governance: The international journal of business in society, 7(3), 312-325.

Ramady, M. A. (2010). The Saudi Arabian economy: Policies, achievements, and challenges. Springer Science & Business Media.