The Extent of the Application of the Rules of Governance on Industrial Public Joint- Stock Companies Enlisted in Amman Stock Exchange

Abstract

This study aims to study the extent of applying the governance standards on the public joint-stock industrial corporations listed in Amman stock market.  Some concepts of governance have been discussed, the principles of governance clarified, identify the criteria, objectives and the importance of governance. We used a questionnaire to point out the extent the companies apply the principles and criteria of governance and make sure if the corporate separated the duties of the Executive Director and Finance Director  for the purpose of prevention fraud or embezzlement of the  shareholders funds, as well as to achieve the separation between the job of the Chairman of the Board of Directors and his Deputy, and allow publishing realistic reports of the auditors in respect of the performance of the Jordanian companies, which are the basics and fundamentals of institutional governance and the most important result concluded by the study.  It has been found that the Jordanian companies are still (up to date) suffer from the conflict of interests between the its Board of Directors, remaining shareholders and family companies, beside the singularity of the management in taking the decisions to their own interests supported by various financial legislations. the study recommended that the companies listed on the stock market in Jordan to upgrade the application level of corporate governance rules effectively, so that would encourage investors to invest in the companies that provide protection for shareholders, deal in transparency, full disclosure in financial reports and independent of boards of directors.