THE INFLUENCE OF CORPORATE GOVERNANCE ON TECHNOLOGICAL INNOVATION PERFORMANCE IN SAUDI ARABIA

Corporate governance (CG) has become increasingly significant in many countries, including Saudi Arabia, particularly following regulatory reforms introduced in 2017. While it is commonly believed that effective CG can foster technological innovation, most existing evidence for this relationship is indirect. This study seeks to provide direct empirical evidence regarding the impact of CG on innovation among Saudi firms. Using panel data from 100 companies listed on the Saudi Tadawul exchange, the research employed descriptive statistics, correlation analysis, and multiple regression to identify potential predictors of innovation. The findings indicate that board independence and the presence of an audit committee are positively and significantly associated with R&D intensity and patent output, suggesting their importance in promoting technological innovation. In contrast, CEO duality was found to have a significant negative impact on innovation measures, while ownership concentration showed no significant effect. Overall, corporate governance factors were found to account for 37% of the variation in R&D intensity, highlighting their substantial role in determining innovation performance among Saudi firms. Despite these insights, the study acknowledges limitations such as a scarcity of prior literature directly addressing the relationship between CG and technological innovation.