Business Task 2 on reflection Essay

UAE otherwise known as United Arab Emirates is amalgamation of 7 Emirates namely Umm Al, Quwain, Ras Al Khaimah, Ajman, Sharjah, Dubai, Abu Dhabi, and Fujairah. UAE is the hour biggest Arabian Middle East economy. The United Arab Emirates is the name 3 biggest in this region in crude inunct exporting, following Iran and Saudi Arabia. It possesses the number 6 biggest recognized conservative crude oil reverse and the fifth biggest natural gas reserves. The swift growth in demand of wet and electricity has generated the necessity to appraise unconventional power generation sources. In the course 2008, the United Arabs Emirates produced energy white paper on believe of energy that con securelyed that nuclear power to be environmentally well-disposed and safe alternative which would increment the prevailing plants of power in accomplishing change magnitude energy requirements.2.1 Objective of this memorize accomplishment The objective of this study of examining whether self-command bodily social organisation matters for the public presentation of stanchs in United Arabs Emirates was achieved. Empirical read suggests that in private held watertights tend to be more efficient and more profitable than publically held firms. This shows that possession structure matters. The question now is how does it affect firm surgical operation? This question is very grievous because it is based on a seek agenda that has been strongly promoted by La Porta et al. (1998 1999 2000). According to these studies, misadventure of the legislative framework to provide sufficient protection for external investors, entrepreneurs and installation investors of a company tend exit maintain large positions in their firms thus resulting in a concentrated self-control structure. This paper aimed at looking at whether self-will structure has an allude on firm surgical operation in UAE. This region has witnessed noteworthy economic growth over the last few c ristals. The region is to a fault facing turbulent generation with respect to collective governance practices, resulting in poor firm surgical procedure. bodied governance issues are not limited to the Gulf region. From a globular point of view, corporate governance has witnessed signifi potentiometert transformations over the last decade (Gomez and Korine, 2005). The data that is used in this study includes 362 non-financial listed firms during the period of 2006-2011 from Thomson one banker, Thomson.com, DataStream and one-year report. Panel data is used to analyse the impact of self-command structure on firm performance number of independent directors on the get along are controlled for. The different types of ownership structure that are included in the study are managerial ownership, family ownership, governance ownership, institution ownership, strange ownership and concentrated ownership.Evidence personalised learning and development1.0 Effects of structure on firm performance It is indisputable, managerial ownership, Chairman own share, institutional investors, corporate total own, institutional owner domestic and corporate foreign all moderate positive effects on firm performance. The evidence is also consistent with theoretical and empirical arguments. On the contrary, When Return on Assets (ROA) is used as a measure of performance the evidence shows that government ownership has forbid effects on firm performance in United Arab of Emirates oil firms. Therefore, performance of United Arab of Emirates oil companies is affected by government ownership. The relationship between performance and ownership structure also differs for firm specific variables such as leverage, GDP growth and firm size. When the Tobins Q is used, the relationship is negative for leverage, GDP growth and firm size. The negative and significant impact of firm size on firm performance when Tobins Q is used can be attributed to the fact that large firms h ave limited investment opportunities, which limit their potential to grow and make profit. Surprisingly, the impact of GDP growth is significantly negative. However, when ROA is used, we did not find any significant relationship with firm performance in United Arab of Emirates oil firms. This study also shows that there may be a necessity to stir up policy makers of United Arab of Emirates oil firms to ensure that banks practice the mechanisms of corporate governance effectively. This practice should be compatible for the business environment of United Arab of Emirates oil firms, whereas adopting the same governance standards in order to ensure unification of revealing level among the banks. It is expected that the best practice of the corporate governance characteristics will contribute to improve efficiency, effectiveness and monitoring in the Islamic banks of UAE. Therefore, this can only be applied by developing the regulatory and get frameworks. In the last 4 decade s, queryers have believed that there is a friendship between the firm performance and the ownership structure. In this regards, there has been publications of umteen studies on different markets to inspect this relationship. This connection between performance and ownership structure dates back to empirical study of Mean and Berle in the year 1932 that got that the weakness of shareholding in a negative way influence the performance of affirm via an inverse relationship. Generally, the number of well-developed policies and the present legal systems are ill developed in the markets that are emerging. These new markets, according to most digest studies, lack protection for their creditors and shareholders (La Porta, 1999).2.0 Ownership structure in relation to firm performance The issue as to whether ownership structure matters for the performance of firms has been an important subject of debate in the finance literature. Empirical evidence suggests that privately held firms tend to be more efficient and more profitable than in public held firms. This shows that ownership structure matters. The question now is how does it affect firm performance? This question is very important because it is based on a research agenda that has been strongly promoted by most researchers in economics. According to these studies, mischance of the legislative framework to provide sufficient protection for external investors, entrepreneurs and creation investors of a company tend will maintain large positions in their firms thus resulting in a concentrated ownership structure.This finding is fire because it implies that ownership structure can affect the performance of the firm in one way or the other. It is indisputable the lack of regulations in corporate governance gives managers who intend to mishandle the flow of cash for their own personal interest a low control level. The empirical results from the past studies of impacts of ownership structure on performance of corporate have been inconclusive and mingled up.ReferencesGomez, P.Y. & Korine, H. 2005, Democracy and the Evolution of Corporate Governance. Corporate Governance, 13, 739-752.La Porta, R., L. et al. 1999, Corporate ownership around the world. The Journal of Finance, 54(2), 471517.Source document