Impact of Corporate Governance on Financial Performance: Empirical Evidence of the Selected Telecommunication Companies of GCC

The impact of corporate governance (CG) on a company’s financial performance (FP) has been acknowledged by researchers and accounting experts. Studies on the effects of corporate governance frameworks on business performance usually ignore the possibility that directors can inflate reported profitability in an effort to achieve a variety of objectives. This study explores the relationship between corporate governance on corporate financial performance of selected telecommunication companies in GCC. The selected GCC telecoms companies’ annual reports and Thomson Reuters were utilised to collect the data, which was analyzed using univariate OLS multiple regressions. The data collection period included 2012 to 2021. According to the study’s findings, when performance is taken into account along with managers’ opportunistic tendencies, the effect of corporate governance on financial performance is negligible. It is advised that rather than placing more emphasis on the proportion of independent directors to total board members, the appointment of independent directors should be based on the historical performance of such directors. This study will aid in the understanding of the impact of CG on FP by academics, accountants, regulators, and policymakers.