Abed Al-Nasser Abdallah

Incomplete Contract, Agency Theory, and Ethical Performance: A Synthesis of the Factors Affecting Owners’ and Contractors’ Performance in the Bidding Construction Process

This paper builds on agency theory and contract incompleteness theory to explore the ethical relation between owners and contractors in the construction process. Using factor and multivariate analysis, it transpires that cost, quality, time/past performance, and information available about the project are important factors that should be taken into account in any future contract between the owner (the principle) and the contractor (the agent). The results provide important empirical and theoretical implications in identifying the contractual elements of incomplete contracts, which, if considered, are expected to reduce the agency theory problem, while at the same time enhancing the ethical relationship between owners and contractors.

Acquirer's return and the choice of acquisition targets: does acquisition experience matter?

We study a sample of 6503 UK acquisitions completed between 1985 and 2004 and control for previous deals similarities. Returns for frequent acquirers decrease constantly but they remain positive through high-order deals. We do not detect an improving pattern of returns but, at best, a stable one when the deal is settled for cash. Using ‘characteristics-based’ experience variables, our multivariate analysis shows that the acquirers’ returns are unaffected by prior acquisition experience. However, we find solid evidence for acquirers drawing inferences from prior experience in designing the method of payment, selecting the organizational form of the target firm and engaging in focused acquisitions, which is consistent with learning through acquisitions. The results are robust to various consistency checks.

The Effects of Corporation/Country Characteristics and the Level of Corporate Governance on Corporate Risk Disclosure: The Case of the Gulf Cooperative Council (GCC) Countries

This paper explores corporate risk disclosure (CRD) in the Gulf Cooperative Council (GCC) countries and its relation to different firm’s characteristics, level of corporate governance and country of origin. Employing content analysis we searched the 2008 annual reports of 424 GCC publicly listed firms for 45 types of CRD. Using univariate and multivariate analyses, we report a positive relation between CRD and the firm’s size, leverage, and number of years using IFRS. We also find that financial and non-Islamic financial institutions disclose more risks than other firms in the sample. Using the BASIC score, which is a corporate governance index developed by the National Investor (TNI) in collaboration with HAWKAMAH (The Institute of Corporate Governance in the UAE), we find a positive relation between the firm’s level of corporate governance and CRD. Interestingly, we document an increase in the level of CRD with more corporate communication and disclosure. Compared to prior literature (e.g. Dobler et al, 2011), our paper is unique because it is the first to explore the relation between CRD and IFRS, the difference in CRD between Islamic and conventional financial institutions, and most importantly, the impact of corporate governance and corporate communication on CRD.