Purpose The purpose of this study is to explore the impact of corporate governance (CG) on the corporate social responsibility (CSR) disclosures. This is done in the context of firms operating in the Gulf Cooperation Council (GCC) countries and is largely based on the legitimacy theory, although other theories such as principal–agent theory and stakeholder theory are disucssed. Design/methodology/approach This study used the annual reports of 147 firms in the GCC countries, drawing on a legitimacy theory framework to determine the impact of CG characteristics, such as management ownership, ownership concentration, independence of board members, duality of CEO and chairman positions and the existence of an audit committee, on firms’ CSR disclosures to various stakeholders. Accordingly, the authors developed five hypotheses to examine the above variables and used a data set from Hawkamah – the Institute of Corporate Governance. This study covers a period of six years (2007-2012). The data set had been regressed in a multi-variate regression analysis. Findings The authors reported that greater managerial ownership and concentration of ownership have positive impact on CSR disclosures. The findings of this study also show that internal CG mechanisms, such as the independence of board members, the separation of powers, between the CEO and chairman positions and the existence of an independent audit committee, also have a positive influence on CSR disclosures. In addition, the leverage ratio, return on assets, company’s size and age emerge as important determinants of CSR disclosures; nevertheless, the company’s size and age are statistically not significant. These significant findings corroborate the recent concern with CG in developing countries that brings greater attention to CSR disclousures, as both internal and external CG mechanisms are effective in influencing the CSR practices. Practical implications This study fills the gap in literature by providing empirical evidence on the impact of CG on CSR disclosures in a significant region in the emerging economies. Furthermore, it alerts regulators, policy-makers, practitioners and firms’ executives in the GCC region and other developing countries to pay more attention to CG reforms and enforcement as well as to increase institutional pressures regarding CSR adaptation. Originality/value The study on how CG and CSR disclosures are connected has been limited. This study addresses this research gap and focuses on a region that has often been overlooked by accounting research.

Purpose This paper aims to examine the relationship between the readability of annual reports and corporate performance in Qatari listed firms while controlling for a firm’s competitive position, governance structure and specific features such as size, age and industry type. Design/methodology/approach This study relies on both agency theory and legitimacy theory to develop testable hypotheses. It uses a sample of 126 firm-year listed companies in the Qatar Stock Exchange to test obfuscation in the annual reports through examining the association between the readability of Narrative Disclosures (NDs) and corporate profitability, financial risk and agency costs for the period from 2014-2016. Findings The findings show that firms with higher annual report readability are more profitable and have lower agency costs, which is an indication of the existence of “obfuscation.” Qatari firms may use narrative complexity as a disclosure strategy to enhance their image and consequently maintain their social legitimacy. Research limitations/implications Although the study findings suffer from limited global generalization, they can be generalized across Gulf Cooperation Council countries. Thus, future cross-country research is encouraged. Practical implications The findings encourage Qatari policymakers to instate a policy for “Plain English” writing to make NDs easy to read by international investors. Originality/value This study is one of very few studies that examines the readability of annual reports in emerging market economies, i.e. Qatar. The study contributes to the paucity of research that examines English-written annual reports in non-English speaking countries.

Purpose -The governance structure of Islamic financial institutions (IFIs) implements Islamic canon law (Shari'a) into business transactions through Shari'a supervision processes. This paper aims to define Shari'a supervision and examine Shari'a supervisory councils (both within and outside the Central Bank), Shari'a consulting firms, Shari'a advisors, and Shari'a Supervisory Boards (SSB). It also discusses the importance of the hierarchical position of SSBs and evaluates their objectives and functions. Design/methodology/approach -The paper reviews a wide range of theoretical literatures especially recent proceedings of relevant conferences in the Gulf Cooperation Council (GCC) countries along with the standards of the Accounting and Auditing Organization of Islamic Financial Institutions (AAOIFI). A framework for understanding the role of the SSB is developed suggesting a set of objectives and functions for the SSB. Findings -The paper finds a lack of standardization among the IFIs concerning the position of the SSB within the corporate hierarchy. Moreover, the SSB is found to control the IFIs activities more than the other types of Shari'a supervision such as Shari'a consulting firms and Shari'a advisors.Research limitations/implications -The research focuses exclusively on the GCC countries and excludes the other Middle East and Far East countries where Shari'a supervision might have different forms. Social implications -The research provides guidelines for IFIs in defining the SSB role in their governance structure and recommends the SSB among the other forms of Shari'a supervision (Shari'a consulting firms and Shari'a advisors) in controlling the IFIs activities. Originality/value -This study contributes to the literature gap about the governance of IFIs. It is one of the first studies that provide a conceptual foundation for the SSB role in the governance structure of IFIs.

Purpose -The purpose of this study is to identify the relation between the conflicts of interest in the Shari'a Supervisory Board (SSB) in the Islamic financial institutions (IFIs) and six independent variables: the SSB executive position, the SSB remuneration, the relation between the SSB members and the Board of Directors (BoD), and the multiple memberships in Islamic funds, issuers of Islamic bonds (Sukuk), and companies trading in capital markets. Design/methodology/approach -The variables are articulated in six hypotheses and tested by ordinary least square regression. The data were collected via a questionnaire which was sent to the shareholders, the BoD, and the SSB members of all of the IFIs in the Gulf Cooperation Council (GCC) countries. Findings -The results indicate that the SSB executive position, the relation between the SSB members and the BoDs, and the membership in Islamic funds and issuers of Islamic bonds are significantly related to the conflicts of interest, whereas remuneration and membership in companies trading in capital markets have insignificant relation.Research limitations/implications -The paper does not address the impact of SSB ownership in the IFIs, or the relation between the SSB and the shareholders, or the impact of the corporate governance codes on the relationship between the IFI and the SSB. Practical implications -The study recommends testing the hypotheses in other geographies to generalize the results, and measuring the impact of the SSB ownership on the conflicts of interest as well as its relation with shareholders, regulators, and clients. Social implications -The paper provides practical implications to the SSB members and the BoD in the IFIs and calls for setting a maximum number of SSBs for each SSB member. Originality/value -This study contributes to the literature gap of the SSB role in the governance of IFIs. It is believed to be one of first studies that provide empirical evidence about the SSB conflicts of interest in the IFIs of the GCC region.

PurposeThe Islamic financial institutions (IFIs) maintain better control over their transactions than conventional financial institutions (CFIs) through the existence of Shari'a Supervisory Board (SSB) and Shari'a Control Department (SCD). The purpose of this paper is to highlight the superiority of Shari'a supervision over external audit and Shari'a audit over internal audit. The study identifies five independent variables that affect the SSB control: ex‐ante Shari'a audit; ex‐post Shari'a audit; SCD reporting to the SSB; corrective actions of SSB towards the management violations; and the number of SSB members.Design/methodology/approachThe variables are articulated in five hypotheses, which are tested by ordinary least square regression. The data are collected via a questionnaire which was sent to the SSB members of 219 IFIs in the Gulf Cooperation Council (GCC) countries.FindingsThe results indicate that ex‐ante Shari'a audit, ex‐post Shari'a audit, and reporting of SCD are significantly related to the SSB control, whereas corrective actions and the number of SSB members have insignificant relation.Research limitations/implicationsThe research is focused on internal factors only, without considering other external factors such as stakeholders and regulators. Also, the research covered the GCC region alone.Practical implicationsThe research recommends testing the hypotheses in other geographies to generalize the results, and including external factors as well as shareholders and board of directors.Social implicationsThe research provides practical implications for the SCD role and calls for merging the SCD with the traditional internal audit department to reduce the excessive work of controlling.Originality/valueThe paper contributes to the literature gap about the SSB. It is believed to be one of few studies that provide empirical evidence about the SSB control in the IFIs of the GCC region.