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Joseph Torbey

DBA Graduate - 2012

Thesis title

Corporate Governance Structure of Joint Stock Companies Exploring Lebanese Tendency.

Supervisor(s)

Jean-Jacques Chanaron
This thesis reviews the background of corporate governance theories from different schools, analyses the basic modes, and deepens the understanding for these modes. The environment of corporate governance for publicly listed companies in Lebanon is changing significantly. These corporate governance aspects have become increasingly important for listed joint stock companies in developed financial markets to ensure that investors are willing to buy companies’ shares such as equity investments or that they are willing to lend money to these companies such as debt financing. Companies that comply with corporate governance standards are often in a better position to attract financing than those who do not comply with corporate governance codes. With constant revision and completion on related laws and regulations, the three most important factors in internal corporate governance structure must be studied carefully, in order to reveal the true nature and specialty of corporate governance structure of publicly listed companies in Lebanon. The three factors are ownership structure, composition of Board of Directors and financing structure, which are the most influential factors on corporate governance structure. The thesis studies their correlation with operation performance respectively and then puts forward different theoretical hypotheses, trying to reveal the basic specialty about the corporate governance structure of publicly listed companies The research results show several specialties of corporate governance structure of publicly listed companies in Lebanon, including stock conversion, extreme low debt ratio, preference for equity financing, opposite market performance and the negative effect of independent directors. The empirical analysis shows: debt to assets ratio is remarkably negatively correlated to operation performance; P/BV and independent directors’ ratio in Board also notably negatively correlated to operation performance; while assets size is positively correlated with operation performance, but other variables have no notable correlation with operation performance.