Saudi Arabia, toward shareholderism or stakeholderism, a comparative analysis and literature review between The Kingdom of Saudi Arabia (K.S.A) and the United Kingdom (U.K).

Abstract

Shareholder primacy and stakeholder primacy have been a subject of ongoing debate and research. This topic has been grabbing worldwide attraction with a focus on shareholder-oriented model no longer fitting in today’s corporate world. With the world’s regulations for corporate law and corporate governance, regulations are shifting between the shareholder theory and the stakeholder theory. With some scholars suggesting shareholder theory alone is no longer being fit in the corporate world. This study's central objective is to delve into the enlightened shareholder value model in conjunction with the two aforementioned theories. Additionally, the investigation extends to the application of these theories within the United Kingdom and the Kingdom of Saudi Arabia and comparing the provisions of the companies act and companies law of the two jurisdictions pointing out the differences and similarities, particularly in light of the significant revisions introduced by the new Saudi companies law, effective as of 2023. This revision introduces noteworthy provisions that pertain to these widely recognized theories, prompting an inquiry into Saudi Arabia's stance regarding their implementation.