The Effect of Government Ownership, Foreign Ownership, Institutional Ownership, and Audit Quality on Firm Performance of Listed Companies in Oman: A Conceptual Framework

  • Ebrahim Mohammed Al-Matari
  • Hassan Saleh Al-Dhaafri
  • Abdullah Kaid Al-Swidi
Conference paper


This study conceptually examines the direct ownership structure (government ownership, foreign ownership, and institutional ownership) relationship with the performance of nonfinancial companies in Oman. It also explores audit quality as a moderating variable between the relationship of ownership structure and firm performance (return on assets). It adopts leverage as the control variable and provides recommendations for future research toward the end of the chapter to further explore the issues examined.


Agency theory Audit quality Firm performance Ownership structure Resource dependence theory 


  1. Abdurrouf, M. A. (2011). The relationship between corporate governance and value of the firm in developing countries: Evidence from Bangladesh. The International Journal of Applied Economics and Finance, 5(3), 237–244.Google Scholar
  2. Adeyemi, S. B., & Fagbemi, T. O. (2010). Audit quality, corporate governance and firm characteristics in Nigeria. International Journal of Business and Management, 5(5), 169–179.Google Scholar
  3. Al Farooque, O. A., Zijl, T. V., Dunstan, K., & Karim, A. K. M. W. (2007). Corporate governance in Bangladesh: Link between ownership and financial performance. Corporate Governance, 15(6), 1453–1469.Google Scholar
  4. Al Manaseer, M. F. A., Al-Hindawi, R. M., Al-Dahiyat, M. A., & Sartawi, I. I. (2012). The impact of corporate governance on the performance of Jordanian banks. European Journal of Scientific Research, 67(3), 349–359.Google Scholar
  5. Al-Hussain, A. H., & Johnson, R. L. (2009). Relationship between corporate governance efficiency and Saudi Banks’ performance. The Business Review, Cambridge, 14(1), 111–117.Google Scholar
  6. Aljifri, K., & Moustafa, M. (2007). The impact of corporate governance mechanisms on the performance of UAE firms: An empirical analysis. Journal of Economic and Administrative Sciences, 23(2), 71–93.Google Scholar
  7. Al-Matari, E. M., & Al-Arussi, A. S. (2016). The effect of the ownership structure characteristics on firm performance in Oman: Empirical study. Corporate Ownership and Control journal, 13(2), 93–100.Google Scholar
  8. Al-Matari, E. M., Al-Swidi, A. K., Faudziah, H. B., & Al-Matari, Y. A. (2012). The impact of board characteristics on firm performance: Evidence from nonfinancial listed companies in Kuwaiti stock exchange. International Journal of Accounting and Financial Reporting, 2(2), 310–332.Google Scholar
  9. Al-Matari, E. M., Al-Matari, Y. A., & Saif, S. A. (2017). Ownership structure, audit quality and firm performance moderating and direct-effect models: An empirical study. Corporate Board: Role, Duties & Composition, 13(1), 28–35.Google Scholar
  10. Barontini, R., & Caprio, L. (2006). The effect of family control on firm value and performance: Evidence from continental Europe. European Financial Management, 12(5), 689–723.Google Scholar
  11. Berle, A., & Means, G. (1932). The modern corporation and private property. New York: Macmillan.Google Scholar
  12. Brown, L. D., & Caylor, M. L. (2004). Corporate governance and firm valuation. Journal of Accounting and Public Policy, 25(2), 409–434. Scholar
  13. Chanawongse, K., Poonpol, P., & Poonpool, N. (2011). The effect of auditor professional on audit quality: An empirical study of certified public accountants (Cpas) in Thailand. International Journal of Business Research, 11(3), 113–127.Google Scholar
  14. Chari, A., Chen, W., & Dominguez, K. M. E. (2012). Foreign ownership and firm performance: Emerging market acquisitions in the United States. IMF Economic Review, 60(1), 1–42. Scholar
  15. Chen, J., Chen, D., & Chung, H. (2006). Corporate control, corporate governance and firm performance in New Zealand. International Journal of Disclosure and Governance, 3(4), 263–276.Google Scholar
  16. Chung, D. S., Kim, B. G., Kim, D. W., & Choi, S. (2008). Corporate governance and firm performance: The Korea evidence. Journal of International Business and Economic, 8(2), 46–54.Google Scholar
  17. Cremers, K. J. M., & Nair, V. B. (2005). Governance mechanisms and equity prices. Journal of Finance, 5(6), 2859–2894.Google Scholar
  18. Dehkordi, H. F., & Makarem, N. (2011). The effect of size and type of auditor on audit quality. International Research Journal of Finance and Economics, 80, 121–137.Google Scholar
  19. Demsetz, H., & Lehn, K. (1985). The structure of corporate ownership: Causes and consequences. Journal of Political Economy, 93(6), 1155–1177.Google Scholar
  20. Ehikioya, B. I. (2009). Corporate governance structure and firm performance in developing economies: Evidence from Nigeria. Corporate Governance, 9(3), 231–243. Scholar
  21. Eng, L., & Mak, Y. (2003). Corporate governance and voluntary disclosure. Journal of Accounting and Public Policy, 22, 325–345.Google Scholar
  22. Fama, E. F. (1980). Agency problems and the theory of the firm. Journal of Political Economy, 88, 288–307. Scholar
  23. Fama, E., & Jensen, M. (1983a). Agency problems and residual claims. The Journal of Law and Economics, 26(2), 327–349.Google Scholar
  24. Fama, E. F., & Jensen, M. C. (1983b). Separation of ownership and control. Journal of Law and Economics, 26, 301–325. Scholar
  25. Fazlzadeh, A., Hendi, A. T., & Mahboubi, K. (2011). The examination of the effect of ownership structure on firm performance in listed firms of Tehran stock exchange based on the type of the industry. Interactional Journal of Business and Management, 6(3), 249–267.Google Scholar
  26. Ghahroudi, M. R. (2011). Ownership advantages and firm factors influencing performance of foreign affiliates in Japan. International Journal of Business and Management, 6(11), 119–138. Scholar
  27. Gitundu, E. W., Kiprop, S. K., Kibet, L. K., & Kisaka, S. E. (2016). The influence of ownership structure on financial performance of privatized companies in Kenya. African Journal of Business Management, 10(4), 75–88.Google Scholar
  28. Gurbuz, A. O., & Aybars, A. (2010). The impact of foreign ownership on firm performance, evidence from an emerging market : Turkey. American Journal of Economics and Business Administration, 2(4), 350–359.Google Scholar
  29. Harjoto, M. A., & Jo, H. (2008). Board leadership and firm performance. Journal of International Business and Economics, 8(3), 143–155.Google Scholar
  30. Hsu, W., & Petchsakulwong, P. (2010). The impact of corporate governance on the efficiency performance of the thai non-life insurance industry. The Geneva Papers on Risk and Insurance Issues and Practice, 35(1), S28–S49. Scholar
  31. Irina, I., & Nadezhda, Z. (2009). The relationship between corporate governance and company performance in concentrated ownership systems: The case of Germany. Journal of Corporate Finance, 4(12), 34–56.Google Scholar
  32. Jensen, M., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs, and ownership structure. Journal of Financial Economics, 3, 305–360. Scholar
  33. Kajola, S. O. (2008). Corporate governance and firm performance: The case of Nigerian listed firms. European Journal of Economics, Finance and Administrative Sciences, 14(14), 16–28.Google Scholar
  34. Kane, G. D., & Velury, U. (2004). The role of institutional ownership in the market for auditing services: An empirical investigation. Journal of Business Research, 57(9), 976–983.Google Scholar
  35. Khan, K., Nemati, A. R., & Iftikhar, M. (2011). Impact of corporate governance on firm performance evidence from the tobacco industry of Pakistan. International Research Journal of Finance and Economics, 61, 7–14.Google Scholar
  36. Khanchel, I. (2007). Corporate governance: Measurement and determinant analysis. Managerial Auditing Journal, 22(8), 740–760. Scholar
  37. Liang, C.-J., Lin, Y.-L., & Huang, T.-T. (2011). Does endogenously determined ownership matter on performance? Dynamic evidence from the emerging Taiwan market. Emerging Markets Finance and Trade, 47(6), 120–133. Scholar
  38. Mashayekhi, B., & Bazazb, M. S. (2008). Corporate governance and firm performance in Iran. Journal of Contemporary Accounting & Economics, 4(2), 156–172. Scholar
  39. Masood, F. C. (2011). Corporate governance and firm performance. International Conference on Sociality and Economic Development, 10, 484–489.Google Scholar
  40. Mautz, R., & Sharaf, H (1961). The philosophy of auditing. American Accounting Association Monograph, 6.Google Scholar
  41. Millet-Reyes, B., & Zhao, R. (2010). A comparison between one-tier and two-tier board structures in France. Journal of International Financial Management and Accounting, 21(3), 279–310.Google Scholar
  42. Mura, R. (2007). Firm performance: Do non-executive directors have minds of their own? Evidence from UK panel data. Financial Management, 81–112.Google Scholar
  43. Musallam, S. R. (2015). Relationships between ownership structures and corporate performance: Evidence from Malaysia. Mediterranean Journal of Social Sciences, 6(3), 70–76.Google Scholar
  44. NazliAnum, M. G. (2010). Ownership structure, corporate governance and corporate performance in Malaysia. International Journal of Commerce and Management, 20(2), 109–119.Google Scholar
  45. NurulAfzan, N., & Rashidah, A. (2011). Government ownership and performance of Malaysian government-linked companies. International Research Journal of Finance and Economics, 61, 42–56.Google Scholar
  46. Nuryanah, S., & Islam, S. M. N. (2011). Corporate governance and performance: Evidence from an emerging market. Malaysian Accounting Review, 10(1), 17–42.Google Scholar
  47. Pfeffer, J. (1972). Size, composition, and function of hospital boards of directors. Administrative Science Quarterly, 18(2), 349–364.Google Scholar
  48. Pfeffer, J., & Salancik, G. (1978). The external control of organizations: A resource dependence perspective. New York: Harper and Row.Google Scholar
  49. Pfeffer, J., & Slanick, G. R. (1979). The external control of organizations: A resource dependence perspective. Contemporary Sociology, 8(4), 612–613.Google Scholar
  50. Phung, D. N., & Mishra, A. V. (2016). Ownership structure and firm performance: Evidence from Vietnamese listed firms. Australian Economic Papers, 55(1), 63–98.Google Scholar
  51. Rhoades, M., Juleff, L., & Paton, C. (2001). Corporate governance in the financial services sector. International Journal of Business, 7(5), 623–634.Google Scholar
  52. Shan, Y. G., & McIver, R. P. (2011). Corporate governance mechanisms and financial performance in China: Panel data evidence on listed non-financial companies. Asia Pacific Business Review, 17(3), 301–324. Scholar
  53. Sing, T. F., & Sirmans, C. F. (2008). Does real estate ownership matter in corporate governance? Journal of Property Research, 25(1), 23–43. Scholar
  54. Ting, I. W., Kweh, Q. L., Lean, H. H., & Ng, J. H. (2016). Ownership structure and firm performance: The role of R&D. Institutions and Economies, 8(4), 1–21.Google Scholar
  55. Tsegba, I. N., & Ezi-herbert, W. (2011). The relationship between ownership structure and firm performance: Evidence from Nigerian. African Journal of Accounting, Economics, Finance and Banking Research, 7(7), 51–63.Google Scholar
  56. Uwuigbe, U., & Olusanmi, O. (2012). An empirical examination of the relationship between ownership structure and the performance of firms in Nigeria. International Business Research, 5(1), 208–216. Scholar
  57. Wan, Z. W. A., Shahnaz, I., & Nurasyikin, J. (2008). The impact of board composition, ownership and CEO duality on audit quality. Malaysian Accounting Review, 7(2), 1–22.Google Scholar
  58. Watts, R. L., & Zimmerman, J. E. (1983). Agency problems, auditing and the theory of the firm: Some evidence. Journal of Law and Economics, 26, 613–633.Google Scholar
  59. Weir, C., Laing, D., & McKnight, P. (2002). Internal and external governance mechanisms: Their impact on the performance of large UK public companies. Journal of Business Finance & Accounting, 29(5&6), 579–611.Google Scholar
  60. Yasser, Q. R., Entebang, H., & Mansor, S. A. (2011). Corporate governance and firm performance in Pakistan: The case of Karachi Stock Exchange (KSE). Journal of Economic and International Finance, 3(8), 482–491.Google Scholar

Copyright information

© Springer Nature Singapore Pte Ltd. 2019

Authors and Affiliations

  • Ebrahim Mohammed Al-Matari
    • 1
    • 2
  • Hassan Saleh Al-Dhaafri
    • 3
  • Abdullah Kaid Al-Swidi
    • 4
  1. 1.Tunku Intan Safinaz School of Accountancy (TISSA)Universiti Utara Malaysia (UUM)ChanglunMalaysia
  2. 2.Amran UniversitySanaaYemen
  3. 3.College of Business and AdministrationUniversity of DubaiDubaiUnited Arab Emirates
  4. 4.College of Business and Economics (CBE)Qatar University (QU)DohaQatar

Personalised recommendations