Abstract
The study aimed at recognizing the concepts and principles of corporate governance, identifying the commitment level of the Jordanian insurance companies to apply the corporate governance instructions issued by the insurance commission and specifying the role of different types of owners in actuating the corporate governance regulations and elevating their quality. The study was conducted on a sample of 15 insurance companies enlisted in Amman Stock market during the period from 2011 to 2014; and in order to measure the ownership structure's variables, the insurance companies financial reports published on Amman Stock market site were utilized, their contents were checked and the companies ownership structure types were identified through the centralization of company shares ownership at a specific entity whereby the ownership structure was divided into five types namely family ownership, institutional ownership, individual ownership, government ownership and foreign ownership. The corporate governance instructions to insurance companies were adopted to design a questionnaire which incorporates five divisions connected to each of the board of directors, the executive management, the audit committee, the risk management and the internal control system and the internal auditing. The questionnaire was distributed on the insurance companies employees who occupied different administrative positions. To realize the objectives of the study, a number of statistical methods that accommodate with the nature of the study were used like the simple regression and the multiple regression models to test the hypotheses of the study. The results indicated that the Jordanian insurance companies manifest acceptable obligation to apply the corporate governance instructions, and revealed the presence of an effect of the ownership structure on the level of those instructions' application. Based on those results, the study presented a cluster of recommendations from which are: specifying the controlling entities in charge of following up the actual implementation of the corporate governance instructions at insurance companies, reformulating said instructions in a way that guarantees the protection of the stakeholders' rights and clarifying the tasks and duties of the audit committee.
Highlights
Since the beginning of 1980s, corporate governance issues have attracted the attention of many researchers and professionals where lots of cases were discussed regarding corporate governance like companies fraud, companies failure and collapse, the misuse of managerial authority and social and environmental responsibilities of companies
Viewing the results of the study, the following conclusions can be produced: 1. There is commitment among the Jordanian insurance companies to apply the corporate governance instructions issued by the insurance commission
There is an impact of the ownership structure on the level of the insurance companies commitment to apply the corporate governance instructions
Summary
Since the beginning of 1980s, corporate governance issues have attracted the attention of many researchers and professionals where lots of cases were discussed regarding corporate governance like companies fraud, companies failure and collapse, the misuse of managerial authority and social and environmental responsibilities of companies. Many corporate governance issues were inconspicuous and not clearly exposed except following the financial crisis of 97-2000 whereupon many researchers and vocational entities attributed this crisis to the failure of corporate governance regulations. This rushed many researchers to conduct their studies and urged the organizing bodies in various countries to issue and modifies the regulations and laws related to corporate governance (Collet & Hrasky, 2005). Despite the multiplicity of the controlling and supervising bodies in Jordan, the financial crises and stumbling cases that came upon many companies worldwide blustered numerous Jordanian companies as well and led them to bankruptcy (Al-Sawalqa, 2014) like the Arab German Insurance Company which was liquidated for reasons related to negative administrative practices and deviation against regulations and instructions
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