Corporate Governance in Listed Companies and its Effectiveness on Market Confidence

Recently gov. represented by General Sports Authority (GSA) has granted STC ( a Saudi listed company) to have the sole rights for transmission of local football matches and the matches of Saudi Football team (they paid SAR 6.6 bn to secure the deal). [login to view URL] However, on 3rd of October, GSA announced that the league will be free to watch on national tv. [login to view URL] How this will affect STC financially. Are there any similar cases happened before? What’s more important is that this kind of gov. action will impact STC’s shareholders. What’s worse is that if it these actions continue to happen it will affect the confidence in the Saudi market and investors will lose hope in the market. Minority interest will raise complaints. The government owns collectively (all its bodies) more than 70% of the listed companies. How this will affect its plan on attracting foreign investors, especially when MSCI just included and decided to upgrade Saudi market to emerging markets. If decisions like this continues and bypassing corporate governance confidence will be severely affected. I need a research report on the effects of such actions on the Saudi financial market. Start with a brief write up on STC’s case and how this will impact their profitability and shareholders (think of minority interest). Then an analysis on the risk of losing investor confidence (especially foreign investors) because of the poor corporate governance and the risk of attracting foreign capital which is part of the privatization plan and Vision 2030 [login to view URL] Conclude with other types of risks (other than confidence and financial risks) that could originate from such actions and a brief recommendation to authorities.