Corporate Governance Codes and Foreign Investment: The Infancy of Albanian Corporate Governance Essay

1.0       Chapter 1: Introduction
Corporate governance is a system formed for directing and controlling companies or organisations[1]. Corporate governance is therefore a set of relationships formed between management in a company, its board of directors, shareholders and all stakeholders and it provides a leveraging structure through which the company’s set of objectives can be attained through implementation of effective performance appraisal systems[2]. Good corporate governance in a company should provide better reward systems or incentives to trail the strategic interests or objectives to a company and its shareholders to facilitate monitoring leading to effective and efficient resource usage[3].

            Good corporate governance leads to improvement in economic efficiency and it has widely been used in establishing gorgeous investment environment in the most successful companies and financial markets thereby enhancing growth[4]. Corporate governance has been used in macro and microeconomic levels leading to improved performance through facilitated corporate access in financial markets to promote shareholder confidence and corporative competitiveness[5]. Albanian financial crisis led to the formation of corporate governance where the OECD council was instructed to come up with a set of standards and guidelines to be used as the corporate governance.

We will write a custom essay sample on
Corporate Governance Codes and Foreign Investment: The Infancy of Albanian Corporate Governance
specifically for you for only $13.9/page
Order now

            Corporate governance is applied both locally and internationally to address legal, institutional and regulatory structures and processes to create the operational area of a company[6]. OECD principles are acknowledged by the Financial Stability Forum as one of the 12 pillar standards used for sound financial systems[7]. OECD principles form the essential components of the Review of Standards and Codes (ROSC) used by the World Bank and the International Monetary Funds (IMF)[8]. The International Organisation of Securities Commissions (IOSCO) and private bodies such as International Corporate Governance Network to have supported OECD to serve as a reference in the development of various national codes to be applied in corporate governance[9].

            OECD was instructed to encourage non-member countries on development of OECD principles to promote corporate governance by carrying out regional roundtable in association with the World Bank in support of the Global Corporate Governance Forum in countries such as Albania[10]. Corporate governance key stakeholders include higher-ranking policy makers, managers and representatives from different departments such as stock exchange, private organisations, multilateral organisations and non-governmental establishments[11]. The Albania corporate governance was initiated in the year 2001 at Springs and regional flagship established on the Investment Compact for the Albania. Albanian corporate governance is therefore still very young and requires added attention for fostering it[12].

            Albania the least developed and smallest country in the Eastern European is neighbouring the Adriatic Sea bordered with Greece to the southern part, Macedonia Eastern and remains of Yugoslavia at the northern end[13]. Albania is highly populated with a population of about 3.2 million and practicing in agriculture as their major economic activity[14]. Political instability in Albania since 1992 has led to increased economic instability and recession associated with rapidly toning economy, season after season of emigrations due to intense poverty to seek aid from the humanitarian to serve over 30% of the population. Albania has had increased unemployment rates over the decades and Albanian government therefore introduced IMF to advise their companies on different ways through which they can reform their economies[15].

1.1       Research Objectives
The main objective of this study was to investigate corporate governance codes and foreign investment in Albanian. Specifically, the study sought to achieve the following objectives.

1)      To establish the way Albanian properties have been privatised through voucher systems and the importance of voucher systems to the privatised companies.

2)      To investigate how voucher systems have been used to exclude foreign investors in Albania through dispersed ownership.

3)      To establish the limitations of the voucher system taking examples of Poland and Czech Republic.

4)      To examine the application of foreign investment codes and how foreign investment codes can be used to improve foreign investment in Albania taking the case of Czech Republic and Poland.

5)      To investigate how the Albanians have used Law to protect foreign investors and minority shareholders through lifted market entry barriers.

1.2       Research Hypotheses
Hypothesis One: The privatization of property in Albania through the voucher system has brought significant merits to the companies which have been privatized.

Null Hypothesis One: The privatization of property in Albania through the voucher system has not brought significant merits to the companies which have been privatized.

Hypothesis Two: The voucher system had a sidelining effect on foreign investors because of its politically inclined policies.

Null Hypothesis Two: The voucher system did not have a sidelining effect on foreign investors because of its politically inclined policies.

Hypothesis Three: In spite of its perceived advantages, the voucher system is a stumbling block to equity and equal opportunities in investment.

Null Hypothesis Three: In spite of its perceived advantages, the voucher system is not a stumbling block to equity and equal opportunities in investment.

Hypothesis Four: Foreign investments codes are stimulants which can go along way in boosting foreign investments.

Null Hypothesis Four: Foreign investments codes are not stimulants which can go along way in boosting foreign investments.

Hypothesis Five: Legislation plays a defensive role in shielding foreign investments and minority shareholders.

Null Hypothesis Five: Legislation does not play a defensive role in shielding foreign investments and minority shareholders.

1.3       Research Questions
1)      How has Albanian properties been privatised through the voucher system and what is the importance of voucher systems to the privatised companies?

2)      In what ways have voucher systems been used to exclude foreign investors in Albania?

3)      What are the limitations of the voucher system taking the examples of Poland and Czech Republic?

4)      How can the application of foreign investment codes be done and in what ways can foreign investment codes be used to improve foreign investment in Albania going by the examples from Czech Republic and Poland?

5)      In what way have the Albanians used Law to protect foreign investors and minority shareholders through lifted market entry barriers?

2.0       Chapter 2: Literature Review
2.1       The Privatization of Albanian Property
2.2.1    How the Voucher System Was Used In Privatizing State Held Companies
Voucher systems or scheme is the process by which the initial share distribution of the government property is determined through auctioning. In voucher system, the actual shares provided by an individual will differ depending on the bids during auctioning but generally, the initial distribution tends to be definite. It is believed that the right choices or decision made will always result in to increased interest and ex-ante political prop up than simply assigning people written pieces of paper as the legal documents for claiming their rights to own an asset or a property[16]. It is not mandatory that voucher system be applied in auctioning because the auctioneers may use cash system of payment for the properties.

The voucher system provides an alternative to the cash payments in the auctioning process. This implies that voucher auctioning is highly preferred to cash because it is perceived to be a decidedly fair system. This is because the voucher scheme provides all citizens with a fair and equitable chance of getting the same opening share as the endowment vouchers[17]. Voucher system was used in the auction markets to create fixed costs aimed at reducing financial intermediary’s costs as compared to other payment systems used in the markets such as cash. Use of voucher system in Albania led to increased trading of the public owned companies with sufficient public information provided leading to positive distribution of the externalities.

          2.2.2    How Voucher System Did Not Include Foreign Investors.
Voucher system was implemented to exclude the foreign investors. This was because the policies applied in the voucher system were more political than social and so did not favour the foreign traders as compared to the cash payment or sales system[18]. Voucher system has made the cash users in the current state-owned enterprise business to be treated suspiciously. This is because in most cases, citizens have doubted their financial sources particularly when paying in cash for highly valuable properties and therefore perceived to have been ill-gotten money from the past regimes. Cash payments have been discouraged because it is unfair to the domestic investors while it favours much the foreign investors who can increasingly bargain to acquire most of the state-owned assets valuable properties at a relatively lower price. Albania therefore did not allow the foreign investors to purchase their state-owned assets[19].

2.2.3    Voucher System Use in Dispersed Ownership
Voucher system required the collective action of the corporate members or shareholders in a given fund due to ownership concentration on the funds. This was mainly because the researchers argued that dispersed ownership of the funds as used in the voucher system hinders effective or total control and management of the funds from the shareholders[20]. In most cases, if the organisational spending had exceeded the expected returns to the investors, then the organisation will not be invested in because it will most probably lead to losses to the investors. The varied shareholder base increased organisational cost is expected and concentration of shared fund ownership will enhance management and control of the financial infrastructure. In Czech Republic, each investor was allocated a small share as the endowment fund from each firm at the beginning leading to relatively smaller benefits received in the individual firms.

With the dispersed voucher system, collective action from the stakeholders is very difficult to achieve leading to high chances of the individual firms running at a loss. This is because the wide dispersion of the shareholders will bar concentrated shareholders actions or control of the organisational activities as it would have been in the public ownership where everybody is a shareholder and so have the notion of shared responsibility[21]. In Czech Republic, the investors considered their vouchers as single units of capital and therefore preferred intermediary management of such capital[22]. This is because the financial intermediaries were considered the right people to manage and control the mutual funds in a cost effective way and providing the shareholders with the relevant information.

Dispersed ownership was also encouraged because optimizing on debt contracts within the voucher system and the intermediary use would hold the assets in illiquid state. This is because centralised monitoring of the individual loan units with a single financial intermediary may be perceived as lack or inadequate active markets for the assets[23]. In this sense, the financial intermediaries will be obliged to effectively control and monitor the market illiquidity in order to successfully transact in the markets. Voucher system will therefore be used to facilitate the mutual funds control through the intermediaries. Mutual funds can be generated endogenously through a free and fair dispersion of the available shares directly to the citizens[24]. This is because management of so many shares may slow down growth in the organisations.

2.2.      Failures of the Voucher System
Voucher system failed because most of the voucher users felt it was more politically oriented and so prohibited foreign trade. Foreign investors found it very difficult to work with the vouchers as compared to cash that they had initially used. Even though the voucher scheme was introduced to provide an equitable and fair opportunity to the investors, it was unfair to the foreign investors. In addition, the vouch system was relatively costly to most investors[25]. This was because the mechanism was a burden to the Albanian and other investors as a means through which to accomplish a financial transaction. Many market users have suggested for a separate auctioning markets through which voucher auctioning bidding can be specifically used for those interested in the voucher system can attend and thereafter the market is closed. The majority of the Albanians therefore preferred cash system to the voucher scheme to avoid the exceptional issues in the market.

 The high costs in voucher system resulted from its complicated creation and use in the markets such as designing, educating the users or common people, implementation of the appropriate infrastructure for the auctioning process. Moreover, it was very difficult for the occasional capital markets users to undergo the usage trainings of the voucher systems just for a single day use and then to learn another for every different transaction daily as it was very common in Albania[26]. In Albania, the voucher system was ushered with increased flawed activities in the country hindering privatization process. This was because of lack of public awareness, inadequate technical staff and poorly equipped auction centres leading to unreliable voucher distribution services.

In Albania, 50% of the auctioning staffs were unqualified and so they made many errors during the operations and only to be realised later leading to increased uncertainties and losses. Being that auctioning was being done based on state-owned properties or enterprises, it was recommended that the public be informed of the progress of such activities. In Albania, public information was inadequate and in most cases, those directly responsible for the auction process recorded wrong information in areas where they had blundered giving the public wrong information about given properties sold[27].

Voucher system involves internal usage of shared funds amongst the corporative and so calls for an appropriate financial or fiscal structure through which such funds can be generated. Development of the appropriate financial management infrastructure was a problem to some nations such as Albania, which led to increased insecurity cases and therefore hindered privatisation progress. In Albania, so many security and privatization policies or laws required implementation and interpretation. Moreover, Albania had poor security design, control, and assessment and reinforcement systems[28].

The experience with the voucher system in Czech Republic such as non-pecuniary penalties for example jailing or physical injuries discouraged so many capital investors on the use of the scheme. This was because many investors and financial evaluators feared facing such cruel penalties that were inhuman and abusive to the creditors. The many initiated models attracted so many investors leading to big portion of outstanding vouchers. The government therefore had to leverage the funds partly through allocation of adequate firms to implement vouch actions to meet the demands including the public banks[29].

2.2.1    Use of Voucher System in Poland and Czech Republic In 1997
Voucher system has been used in both Poland and Czech Republic for privatisation in more or less the same ways. Voucher systems have been used in auctioning processes to determine the initial distribution patterns of shares of the state properties and this scheme has been applied not only in Poland and Czech Republic but in many other countries too[30]. In Czech Republic, voucher auctioning was based on fixed prices which were used with multiple rounds for the winning bidders to get shares with reduced rounds in their next sales of the remaining shares. This is mainly applicable in the slightly highly or lower charged services, pro-rata shares. The voucher system is iteratively used in the Poland and Czech Republic until all the shares are received back and the process starts all over again.

The burden experienced with the voucher users will be easily manageable if the auction processes are significantly provided to benefit the users for example through price discovery.  In both Czech Republic and Poland, it has been doubted whether the vouchers system will actually lead to price discovery. An experiential study done in Czech Republic about auction processes showed that the updated policies governing the voucher auctioning in the country was rejected because it was a barrier to price discovery[31]. This is because in most cases the property evaluators have failed to find the exact value of certain state-owned properties and so cannot really discover the prices using the vouchers.

As a requirement, voucher system has necessitated the use of endogenous shared funds that requires an efficient regulatory and legal framework to facilitate creation of the required funds. This was very efficient in Czech Republic and Poland where they had highly reliable security design to promote monitoring, control and enforcement leading to rapid and successful privatization process[32]. Initially, when privatization was introduced in Czech Republic the citizens did not realise the need for formation of shared funds management infrastructure. Later on use of mutual funds was recognised and encouraged because of the endowment of vouchers and its use as an initial capital unit. Voucher scheme provided its users with the voucher packets that could be easily managed in convenient portions or units.

   Voucher system made it possible for the citizens in both Poland and Czech Republic to easily transact with the entrepreneurs in the capital markets to facilitate voucher deposition in exchange for the fixed payments after the privatization process. The role played by the financial intermediaries in the financial markets facilitated citizen-investor relationship with the markets leading to reduced burden on the voucher system processes  such as complicated voucher process mastery and independent evaluation of the company[33]. In Czech Republic, the discovery cost was being charged on the fund manager and then distributed to the corporate members of the funds. This attracted increased number of investors who had accepted the voucher system as a more efficient method for privatisation of the state owned enterprises[34].

In Czech Republic and Poland, use of voucher systems did not fully favour the financial institutions because in some cases it troubled the users and so the safest way to use it was that the financial controller or manager had to invest their own capital and only to suffer the consequences if he/ she fail to comply with the regulations[35]. The penalties given to the financial controllers were not financial at all for example jailing or breaking the controllers legs if he fails to honour the investors’ interests. Most managers in the financial markets over-promised if they escaped the penalties from investors on their non-performance. Penalties were encouraged because it was the only way out through which the managers would fulfil their promises without craving for the larger shares only even though there were no incentives for the promises hence no effective penalties against non-performance.

Although Poland and Czech Republic rapidly succeeded through their privatisation processes, the countries are still experiencing management challenges with the funds and the investors. This is because the required regulatory laws and policy systems were not formed to govern the privatisation processes before distribution of the shares translating to inefficient operations in the security market[36]. Privatisation in both Poland and Czech Republic succeeded technically where the transfer of ownership of the properties from the public to the private individuals was achieved but the nations never met their set goals.

2.3       Foreign Investment Codes
2.3.1    How Having a Code Will Improve Foreign Investment in Albania
During the foreign investments in Albania, buying and selling of pieces of land or leasing mortgages was done based under the Law of Buying and Selling of Land, Law No. 7983 which was published on 27th of July in the 1995. The Law provided a limit to the land leasers and the clients’ indifferent ways including[37]. First, the first refusals right where the land had to first be given to the next of kin before it is offered to the other people. Second, joint family ownership and this did not clearly define what a family was. To solve the problem, a land transaction law was adopted on 23rd of April 1998. The Law No. 8336 was aimed at improving the land ownership securities[38].

            To come up with a lasting solution on the land ownership securities, the Albanians came up with a new Civil Code numbered 7850 and dated 29th of July 1994. This Law was later on approved in the Albanian parliament that allowed the foreigners to own the public and agricultural lands for a period of 30 to 99 years depending with the investment activity being done on such government properties.  In Albania, the legal identity of different bodies or units was done through a Law based on Civil Code, which was established on July 1994. The Civil Code of the Albania naturally identifies the commercial entities to be privatised, outlining the details of the legal property owner’s rights such as creation, the legal foundations and obligatory components[39].

         2.3.2    OECD Principles
Privatization is the process by which a company transfers some of its ownership controls or all to a private sector and this is a continuous process through which private-public partnerships are formed[40]. Privatisation has widely been used as a measure through which the private sectors can increase their roles in the economic markets in different ways such as deregulation to legal entry of private sectors to the markets and liberalisation to facilitate competition[41]. Privatisation in Albania has not been very effective yet privatization is expected to bring corporate governance to the corporations which were previously being run by the government. Privatisation of the Albania property has failed due to lack of critical strategic plans to facilitate mid and long-term goals achievements[42].

The investors have been discouraged due to the poor results from privatised companies in Albania and most especially the old mentality of privatization that was associated with the legal framework and mentality questions. Moreover, there were disparities in the organisations due to liberalisation of goods, capital, and inadequate financial and banking systems in the markets with the human resources included[43]. There was therefore need to redesign the strategic market development systems with special attention given to privatisation concepts to enhance its image[44].

Privatisation and market restructuring goes hand in hand with the legal framework implementations which requires clear definition of the set of standard rules or legal requirements to be assessed and regulated constantly leading to improved market value and exchange transparency[45]. Albania came up with new strategies and initiatives that initiated changes in the complexity and different dimensions of both micro and macroeconomics such as social, political and legal dimensions to improve on both market liberalisation and recapitalisation[46]. Albania wanted to set free its market sources and improvement opportunities available within the country leading to the emergence of a privatisation strategic judgement from the Council of Ministers that stressed on the following.

Albanian based their privatisation strategies on integration of all the stakeholders’ activities and processes and rejuvenating their economy through increased use of human and natural resources[47]. Albanian wants to certify to make their properties intellectual monitoring their properties to ensure a steady growth rate in economic development systems and entire organisation. Albania is dedicated to involve the private sectors to support them in the production services and attract new and potential investors’ as many as possible leading to formation of improved capital markets[48]. Albania wanted a privatisation process that will be applicable and beneficial in all its production sectors, to prevail a faster and effective way through which transparency and socialisation can be improved.

The privatisation process should promote economic regeneration through adoption and support of processes to facilitate continuous expansion, progress and corroboration properties in the companies[49]. Privatisation leads to change in the organisational structure, systems, Management hence governance. Corporate governance will be used to bring together the board of directors, executives and all the shareholders, which is easily initiated, in the organisations through transformation and integration of systems and processes to enhance communication[50].  Very few firms have privatised their state owned properties particularly in developing nations such as Albania that was 10% a decade go[51].

Nevertheless, Albanians wanted a privatisation process of their properties that facilitate production activities to meet the organisational or company objectives[52]. Privatisation should lead to democratization of property to promote social interactions, improved living standards through reduced budget deficit, and increased budgetary income in one way or another[53]. Albanian privatisation was done based on specific dimensions of the organisation to capture different and specific process requirements of the operation. Different frameworks were formed to facilitate privatisation processes in Albania to enhance corporate governance in micro and macroeconomics[54].

2.3.3    Legal and Institutional Frameworks Used In Albania for Privatization of Property
Privatisation strategies has been legalised by the Law No. 8306 formed on 14th March 1998 called ‘Strategy of Privatising sectors of special importance’ which has been applied as a privatisation shareholder package for strategic operations in trading companies[55]. The Law is headed by Consultancy and the DCM has changed Transparency Committee used for decision-making by the Council of Ministers (DCM) and it to No. 621 in September 25th in the 1998 and again in 2002 on 28th January to DCM No. 32[56].

The Albanian institutional and legal procedures used were based on Law No. 8306 published in 1998 for all public companies that aimed at privatising had to use a specific law to govern the privatisation processes for instance for definition of the privatisation structure from anonym companies[57]. The Council of Ministers are to form and approve the legal and institutional laws formed in Albania depending with the law used. First, selection of tenders from strategic investors and the relocation of shares[58]. Albania wants to ensure improved selection systems for the strategic and potential investors who are interested in purchasing shares from the companies. Companies should be in a position to perform effective performance appraisals after privatising the companies and therefore effectively use the profits generated from privatisation[59].

The legal and institutional frameworks are used for endorsement of project contracts as given to the potential and strategic investors who are willing to buy shares with the relevant information on presentation and accessing offers in the companies. The institutional and legal frameworks will facilitate endorsement of the appraisal reports as offered to the privatised companies. For any economic reforms, commercialisation or reconstruction as a necessity in privatisation, Albanian had to consider some prerequisites particularly in governmental institutions[60]. The preconditions requires proper management else increased losses may be experienced in the privatised companies. This call for corporate governance that will ensure all key stakeholders are involved leading to improved efficiency and optimised rates of returns.

2.3.4    Cadbury and Other UK Codes
There have been increased cases or issues arising from corporate governance based on certain identifiable processes and factors. UK for over 12 years has carried out several investigations on ways through which corporate governance can be improved in the companies leading to formation of many reviews such as Greenbury, Hampel, Turnbull and Cadbury report amongst others[61]. In addition, the UK government has successfully accomplished their investigation on the Company Law Reviews. Investigations were carried out based on different codes that have been formed on corporate governance since 1990 such as Cadbury, Greenbury, Hampel, Turnbull and Company law checks[62]. Cadbury has been used as a point of reference to the emerging reviews in the UK because of two main reasons. First, it is an influential model on corporate governance issues and second it has contributed a lot to the formation of the Higgs Review as the latest report[63].

Cadbury report has been a success to most of its users because it is a high quality process through which investigations can be successfully done on corporate governance. Cadbury has been used in areas where the stakeholders have different and contrasting interests to come up with realistic implementation proposals[64]. In addition, Cadbury codes are internationally applicable to eliminate the self-regulatory approach used in the public company listings[65]. Cadbury codes have been incorporated in to other UK national codes and in the OECD principles of corporate governance[66]. Even though there are some differences in the Company Law Review and Cadbury Report because the Cadbury review had initiated a self-regulatory policy on listing public companies. While the Company Law Review provided the legislative policies to govern the companies’ transformation laws leading to corporate governance[67]. Many people worldwide accepted Cadbury report and its stakeholders were approved leading to its use in the implementation of the legal requirements in an Operating and Financial Report (OFR)[68].

 The Operating and Financial report consisted of the corporate governance and the social responsibility legal requirements[69]. Financial Reporting Council (FRC) was integrated with the Financial Services Authority process proposal as was suggested by Derek Higgs and the UK government urgently endorsed this[70]. The UK codes were combined as was proposed by Higgs as a means through which operational efficiency and effectiveness can be attained in the public owned companies[71]. Cadbury model provided the public companies with recommendations on good practice leading to improved financial management and accountability through formation of combined committees[72]. The management and non-executive directors were to be assigned specific responsibilities to review and report performance and financial information to the shareholders[73]. The links between the auditors, board of directors and the auditors can be easily achieved through the Cadbury model or code[74].

2.4       State Laws and How It Protects Foreign Investments and Minority Shareholders
In Europe particularly in Albania, the second company Law Directive has been formed to protect the creditors in businesses[75]. Since the emergence of limited liability companies, the incorporation with the limited liability companies has been very challenging due to their philosophy of uncompensated risks in trade transferred from the shareholders to the creditors[76]. Laws and Courts in Albania been inefficient in protection of business creditors where limited liability companies have taken advantage of their creditors to meet their financial failures in the business. The Albanians have opted for a limited liability company so that in case they fail to meet their requirements the charges would be transferred to the creditors[77].

            In Albania therefore, the shareholders used the limited liability companies to meet the uncompensated business risks through the creditors using incentives to unfairly distribute the social resources to finance risky projects[78]. Bigger ships and faster airplanes have been used in Albania for transportation of goods and services across borders to the international markets. Increased implementation of regional and worldwide trade agreements have lifted the bars to the foreign investors in Albania[79]. Corporate governance should be implemented to save the rights and interests of the shareholders in a company. Shareholders rights in a company are varied including secure ownership or registration, convey and transfer of shares, equitable and reliable access to information, democracy in shareholders meetings, free and fair election of leaders and equitable sharing of profits and losses within the corporation[80].

            Corporate governance in Albania was opted for to ensure fair and equitable treatments to all shareholders whether a minor or a foreign investor for instance resolution of disputes. Good practice rules and guidelines were formed which included. First, shareholders of a common series in a class should be equally treated by giving them the same rights[81]. This can only be achieved through gathering the relevant information about such investors’ rights before allowing them to purchase given shares from a company. Changes in voting rights have to be approved by the different classes of shares affected to avoid any chances through which the minority shareholders could be abused or unfairly treated directly or indirectly[82].

            Companies at all means should fight at building a lot of confidence to the investors to trust them by ensuring that the investors contribution will be effectively used without any misappropriation by the corporate governors or members who are directly involved with the control of such funds[83]. To protect the interests of all stakeholders, the Albanians decided to provide protection to its investors through careful distinction between ex-ante such as pre-emptive and majority qualification level to be included in decision-making processes and ex-post rights such as resolution of a right once violated to the shareholders[84]. These principles formed in Albania were equally applied to both foreign and domestic investors as members of the corporate governance.

2.5       Barriers to Entry and Growth of the New Firms in Early Transition
Many barriers hindered entry and growth of new firms in Albania during the early stages of transition. Albania went through extreme cases of communism that consequently affected their economy as it happened with their socialist system as compared to other socialist nations[85]. In 1997, several informal business initiatives failed leading to increased losses of so many investors savings followed by a period of violence and destruction in Albania. The communist parties formed after World War II in Albania were the barriers to economic stability since the policies formed in Hoxha’s administration did not support the international communities hindering entry in to the markets or foreign investments in to the country[86].

            Agriculture has been the economic backbone of Albania where before the Second World War agriculture contributed more than 90% of the Albanian output while the industries produced less than 4%. During the socialist parties, industry has risen to about 45% while agriculture remained the highest in the Albanian economy. Transformational recession in Albania affected industrial sectors in the 1990 while the agricultural sectors steadily increased[87]. The political policies formed by the communist after the second World War did not favour the foreign investors in to Albania leading to low productions and stunted economic recovery process after the socialism effects. Even though the Albanians practiced agriculture, convectional production methods where draught resistant animals were reared and hard labour used which led to low productivity[88].

            The coalition government formed thereafter did not provide a lasting solution to the economic crisis in Albania. This is because the members of the coalition government had severally disagreed on the transitional policies that later on led to the resignation of the Democratic Party from the coalition government[89]. The disintegration of the coalition government slowed down the implementation of the economic programmes that had been set to enhance economic stability in the Albanian economic market[90]. It took along time before the new government was formed and during this time, Albania was in chaotic state with series of destruction associated with vandalism and theft of public and government property[91]. The large-scale deformation and mass demolition of property in Albania led to cry off in the national output, severe shortages and inflation with the agricultural sector reducing by 25%, industry by around 45%, GDP almost 40% while monthly inflation rate was around 11%.

            The Albanians experienced shortages in sectors particularly in industry where raw materials and spare parts were scarce leading to very low productions and some industries even closed down during that time hence reduced industrial output[92].Albania experienced many challenges concerning entry in to new markets. Other than the unfavourable trade and political policies that did not allow the Albanians to invest in the foreign countries or allow foreign investors to enter the country, Albania was very far from the westernised developed countries. In addition, Albania did not have common boundaries through which they would regulate their assets to fully benefit from them.

            This had taken place in Albania for over decades until late 1990s when Greece came to their rescue. Greece facilitate trade in to the countries in the southern part of Europe, Albania included where Foreign Direct Investments (FDI) was introduced to facilitate privatisation[93]. Through foreign direct investment, Albania could allow foreigners to invest in to their country and this ushered their entry in to new and emerging markets across the borders[94]. It was because of the different crises that befell Albania such as the failure of the pyramid schemes and coup attempts in the 1997 that led to the decline of FDI[95]. This is a clear indication that Albania has the potentiality of stabilizing their economy if the instability conditions are controlled.

2.6       Privatisation and Transition in Albania
Albania has transformed from violent and autocratic governance to a more volatile market or financial system and has gone through two different periods of violence and political unrest that led to destruction of economy and other natural resources[96]. A democratic government was formed in 1991 to end the demonstrations and chaos and the government took over in the following year to management the economic activities[97]. The Albanian government then pursued new transformation policies to stabilise microeconomics through price liberalisation and foreign investment, privatisation and formation of market economy institutions. Between 1993 and 1996, the Albanian economy started rejuvenating leading to sustained growth and falling inflations[98].

            The Albanians privatised their corporative and the state owned enterprises as the basis through which economic transformations could be formed leading to a favourable condition for economic transitioning[99]. During this time, rapid transfers of ownership as a requirement in the corporate governance and the related incentives for enterprise reengineering were not recognised. In 1997, additional losses were realised when many informal financial institutions collapsed interfering with many investors savings ushering for fresh chaos and violence in Albania[100]. The chaos forced for a new election for a new government and president that has led to improved economic stability and sustainability.

            This was in deed a bad way through which the Albanians would fight for change particularly in the financial or economic markets for example privatization[101]. The majority of the Albanian population resided in the rural areas and so during the post-communist regime, the government took advantage of that to easily reach a larger portion of Albania to seriously influence them to produce more[102]. The Albanian government formed policies through which they influenced their people to embark on serious production using undeveloped technologies and this was very prosperous leading to improved production within a very short time[103]. Albania formed a coalition government in 1991 that came up with economic strategic plans that were similar to the ones formed in Poland and Czech Republic.

After new government had been formed, the economic production programmes were resumed. The economic programmes were aimed at ensuring macroeconomic stability through price liberalisation, foreign investment and formation of institutional markets of economy. In Albania, it has been established that the shock of economic transitions led to increased economic destruction and this ushered the formation of economic and monetary control systems, privatisation strategies, reduced subsidies and improved control on rates of remuneration[104]. The major economic stabilisation process taken by the Albanians was to privatise their public enterprises and undeveloped corporative.

In Albania, private property is presently being value more than it used to be 2 decades back when the Albanians banned private property ownership including plots until multi party regime was formed. The multi party government has legalised privatisation of the property to show their commitment to reform the economic system in use. Since socialism has led to increased or total dependence on state, the Albanians resorted to privatisation to revolutionize the state of mind, mores dependence and dominancy that had extremely affected the nation[105]. The Albanian experienced low levels of income, savings and so privatisation was the only solution since most of the corporate assets, and government properties were not very beneficial to them.

Albania had for a very long time banned the foreign investors from the nation and therefore had no foreign investments that might have improved their economies of scale to the foreign markets[106]. Albania agreed to privatise their industries through free and fair distribution of their state assets to the citizens thereby making them private properties[107]. After the Hoxha’s brutal regime that led to the imprisonment of so many people, many physically injured and others murdered, the Albanian government had agreed to compensate the affected the victims and their families[108]. Through privatisation, Albania would have raised enough to meet part of the compensation value through the privatisation programme[109].

Albania used undeveloped market economy as its institutional and legal framework since the administrative capacity was limited and could not meet the privatisation requirements. Albanians decide to come up with the appropriate methods through which property ownership could be transferred[110]. Corporate governance in Albania was an aftermath of the social, political and economic destructions leading to enterprise restructuring[111]. Albania has taken over years transitioning leading to well establishment of privatisation strategies as a way through which effective control and legalisation of enterprise ownership can be achieved.

            Albanians opted for privatization as a means through which incentive and management systems can be altered to hasten restructuring to bring new investment opportunities and enterprise efficiency[112]. Different privatization methods have been used such as foreign direct investments, which led to concentrated outside ownership and voucher system that led to dispersed ownership hence inefficiency in monitoring and monopoly in the capital markets[113]. In Albania, corporate governance structure has not been given serious considerations as compared to Czech Republic, Poland, Lithuania and Hungary where corporate governance issues have been given the first priority in state-owned enterprise restructuring. In Albania, it is through gradual share ownership that the country could achieve corporate governance[114].

            Albania came up with a privatisation programme that was based on small and medium sized enterprises and a variety of techniques including voucher, direct sales to employees or public and auctions were used[115]. Employees were given the first priority in case an organisation wanted to sell off some of its properties before publicly announcing its sales to the outsiders. In small business privatisation, it was not clear the sizes of business units to be categorised as small hence many legal and conflicting issues arose. The Albanians opted for a very simple voucher form as compared to the ones earlier used in Lithuania, Hungary, Poland and Czech Republic to facilitate auction hence privatization process.

2.7       Foreign Investments in Albania
Albania is amongst the countries in Balkan that are expected to benefit from foreign trade investment although still inadequate because these countries have formed joint ventures[116]. This is because for a long time Albania jut like other Balkan economies, has faced the challenge of drawing foreign direct investments. Foreign investment in Albania has resulted from lack of propinquity and common borders with the developed western nations to facilitate its economic growth[117]. Albania therefore accepted Greece aid in the foreign direct investment trades. With the increasing reforms in Albania, there were increased changes made to virtually accommodate the emerging initiatives that were aimed at improving the economic stability. FDI in Albania started after they had lifted the barriers on trade that prohibited foreign ownership or investments in the country[118].

            However, foreign trade in Albania has not been as efficient as it is in countries such as Hungary, Poland and Czech Republic due to certain factors including. First, market instability in Albania[119]. Second, market size in Albania which is relatively small and therefore of low cost. In most foreign trades, the foreign investors have showed a lot of interest in the larger markets than the smaller ones because of their being more promising by nature. The foreign investors are not necessarily interested in the low labour costs in the markets but they seek new, large and emerging markets[120]. Third, potentiality for mergers and acquisitions in the markets. Initially, foreign investments in the countries resulted from Greenfield investments. Presently, foreign investments are based on mergers and acquisitions in the markets[121].

            Albania has therefore to come up with strategies through which the potential mergers and acquisitions can be achieved in the companies. Albania has formed different joint ventures with different countries in the Southern Europe to facilitate its investment opportunities in the foreign markets[122]. Forth, internal organisational or state factors such as change[123]. State transition or reform in Albania has lagged behind for a very long time. Albania has therefore not been in a position to effectively implement FDI to fully enjoy its benefits such as improved economic instability. Fifth, limited proximity in the European developed markets. Albania is situated very far away from the developed western countries[124]. Albania cannot easily access the developed markets to boost its economy. The increased or wide geographical difference experienced by the Albanians has hindered cross border interaction in the country with the neighbours in the developed market economies.

 Albania has therefore not benefited from the foreign countries for example through technology transfer, capital or any resource sharing. Within 8 years from 1992, Albania had a cumulative value of about US$ 458 million generated from foreign investment particularly from Italy that contributed around US$200 million from its 600 companies involved in the trade[125]. Greece that had introduced FDI in Albania traded with over 300 companies in the country and contributed around US$100 to the total Albanian FDI output[126]. The top foreign investors in Albania included Alba Eureka, Kuhne and Nagel, Wurth and Siemens.

Over 50% of the foreign investors in Albania are from Italy, almost 30% from Greece and the remainder are from Germany, French, British, American Austrian, Turkish and Kuwait amongst others[127]. These differences were because of lack of proximity of Albania with Italians being the leader but they are concentrated in the western region to trade in towns such as Durres, Elbasan, Tirana, Lushnje, Vlore and Shkoder[128].  While the Greek were at the south and southeastern of the country operating in towns such as Korca, Delvina, Saranda and Gjirokastra. The Albanian FDI involved tourism, agriculture, food, construction and light industries[129]. Due to socioeconomic and political instabilities in Albania, the highest values in FDI were registered between 1994 and 1996 and thereafter a decline followed particularly in the 1997 when insurgency crisis was experienced in Albania after the failure and collapse of the pyramid payment schemes[130].

 Foreign investment in Albania benefited them a lot[131]. Other than financial gains, Albania benefited by gaining different knowledge and skills in the market, entry in to new markets, technology transfer and increased job opportunities[132]. This is because the foreigners would come with different expertise and technology to be invested in different industries in Albania thereby improving their productivity[133]. Nevertheless, entry of the foreign traders in to a domestic market will enhance competition in the markets to eliminate or reduce monopoly while encouraging quality productions[134]. Even though Albania has attracted the least number of foreign investors in the central and southern region of the Europe, there is still hope that the GDP percentage in the country will be rejuvenated through FDI[135].

This is because in 2000 Albania registered an increased number of foreign investment partners where more than 2100 joint ventures had been formed and around 1500 foreign companies licensed[136]. Initially, the foreign partners to Albania such as Turkish, Greece and Italian preferred forming the partnerships with the government to gain increased control to the public resources thereby benefiting very first[137]. Small and middle size enterprises have dominated the Albanian FDI where most of the partnering companies worldwide had less than 500 employees[138]. The FDI areas of participation in Albania included tourism industry that produced about 34% from restaurants, beaches and hotels in the major cities. Light industry accounted for 20% on shoemaking and confection where labour was sourced locally and raw materials imported from abroad[139].

Construction industry generated about 15% while the agricultural and food industry produced around 18% and the products were for domestic consumption. In Albania 13 joint baking institutions were formed for the FDI. Foreign trade investment has been a significance tool to facilitate economic development in transition process in different nations because it is the stepping-stone to securing different levels of economies of scale and social development. The convergence of the GDP levels in the European nations at the south particularly to favour Greece as the major foreign investor in Albania will actually depend on the Albanians potentiality to make good use of the opportunities availed by the Greece[140].

In the year 2000, Albania registered an increase in its FDI through dedication to privatization of the Mobile Company and licensing of its new operator sin GSM even though there were certain problems experienced. Other than political instabilities, Albania faces different problems with its FDI such as corruption in administration particularly in taxation and customs policies. Albania for a very long time has not had the law applications and enforcement policies to effectively secure property ownership therefore many problems faced in accessing lands and construction permits or legal requirements. In addition, Albania has heterogeneous basic infrastructure services for instance communication systems, which have led to inefficiencies in information, flow translating to low productions[141].

There were possible progress foreseen in Albania on the FDI depending on the transformation processes that had been achieved. First, Albania had to provide proximity to the European developed markets through provision of fairly well educated employees at relatively low cost, increased investment in rich natural resources such as minerals and agricultural land[142]. Albania had an perfect coastline through which tourist attraction sites or resorts could be built to develop tourism industry and a small domestic market through which export oriented activities spending could be minimised through use of FDI strategic plans on infrastructures. Moreover, cost reduction activities could be easily achieved in the light and natural resource industries and all this is only possible if the impeding obstacles to the FDI in Albania are resolved.

3.0       Chapter 3: Methodology
3.1       Research Framework
The aim of this study was to investigate the corporate governance codes and foreign investments by examining the infancy of the Albanian corporate governance. Specifically, this study sought to achieve various research objectives. Therefore, the framework for this study included the investigation of various hypotheses. The framework for this study also included the use of triangulation methods in the analysis of the various sources of information[143]. It means that in this research framework, the various hypotheses were used along with the literature reviews. Given that this was a study on corporate governance codes and foreign investments by examining the infancy of the Albanian corporate governance, a detailed review of literature on this research topic was presented in the second chapter of the study. The various sources of literature which was reviewed acted as the theoretical framework for understanding corporate governance[144].

3.1.1    The Anticipated Results of the Study
The results from this study on corporate governance codes and foreign investments by examining the infancy of the Albanian corporate governance have outlined a variety of issues in corporate governance. It was expected that this study would be beneficial to the industry players in Albania especially those in charge of corporate governance. The expectation was that these findings from this study would give the corporate governors vital information which would enhance their corporate governance operations. It was also expected the results from this research would be beneficial to other researchers in future. The expectation was that other researchers would use this information as background literature for their future research[145].

3.2       Research Design
This study used the hypotheses and literature reviews as the main researcher designs. It means that the researcher used mixed research methods. The research topic was investigated by investigating various research hypotheses and objectives. It can be argued that the researcher used descriptive and exploratory research methods. The researcher attempted to described and explore the researcher topic through the exploration of various study objectives and various types of literature which made up the secondary sources of information. It therefore implies that the research methods which were used in this study were hypotheses and the structured literature reviews[146]. A comprehensive review of both research methods is given below.

3.2.1    Literature Reviews
The design in this study examined various sources of literature. This implies that the bulk of this research was comprised of secondary information which had been provided from the review of various literatures[147]. Today, various fields of management are faced with various sources of information. This has necessitated the development of a systematic methodology to provide the guiding principles to the concept of managements. Thus, the researcher used the literature reviews as to provide information which could guide various managers in Albania on corporate governance codes and foreign investments: the infancy of the Albanian corporate governance.

3.2.2    Hypotheses
This research was mainly based on the review of literature from various sources. This has implication that the literature reviews has emerged to be a popular research methodology in the field of academic circles[148]. Therefore, the literature reviews provided the framework upon which the researcher developed various hypotheses which could qualitatively be tasted. It means that the researcher developed various hypotheses concerning the research topic then endeavoured to investigate them using by reviewing various sources of literature[149]. A hypothesis refers to a statement which can be proven but which attempts to explain the way a specific phenomenon takes place[150]. For instance, the researcher developed a hypothesis that the voucher system had a sidelining effect on foreign investors because of its politically inclined policies which was later tested in the literature review.

3.3       Research Procedure
This study was conducted by analyzing the information gathered from the secondary sources. The secondary information had been obtained from the literature reviews. The information provided by the various sources of literature was comparatively evaluated in order to end up with comprehensive analysis[151]. For instance, the researcher analyzed the way the voucher systems had been used to privatize state corporations, how the voucher system had excluded the foreign investors, the various ways by which the voucher systems had failed and the way the voucher system had been used in Poland and the Czech Republic. This comparative and detailed analysis went along way in ensuring that the findings of the research were reliable.

3.4       Research Instrument
As was earlier noted, the main instrument in this study was the literature reviews. The use of the research instrument of literature reviews was justified in this research. The research instrument of literature reviews was justified because a practical research such as this one on corporate governance codes and foreign investments needs to factor in the entire possible outcomes of a study topic rather than taking a limited dimension. In this case, the researcher reviewed various sources of literature in order to broaden the reliability of the outcomes of this study[152]. The research instrument of literature reviews was also justified in this research because like any other research instrument, the research instrument of literature reviews involves problem definition, literature search and the reporting of results[153].

3.5       Analysis of Findings
The procedure of analyzing the findings was a comprehensive one. The information which had been provided by the literature review and the hypotheses was analyzed using interpretative analysis using[154]. The interpretive analysis was done using the grounded literature review. It can be argued that the findings were also analyzed suing descriptive qualitative analysis by describing the various corporate governance codes and foreign investments. This implies that by describing the various codes of corporate governance and the way the codes could improve foreign investments. Similarly, the information from the various hypotheses was also analyzed after which these were synchronized with the information from the qualitative analysis of the literature reviews[155]. Eventually, the researcher concluded the study on corporate governance codes and foreign investments: the infancy of the Albanian corporate governance.

4.0       Chapter 4: Findings and Analysis
The study of corporate governance and foreign investment codes as used in Albania was based on hypotheses and the literature review. For a long time, policies on corporate governance have dominated the developed economies. However, among the developing economies, corporate governance appears to develop slowly. This is quite unfortunate given the fact in the world of today; corporate governance is regarded as an integral factor in the establishment of an appropriate investment environment. This has implication that corporate governance has transformed to occupy a dominant place in modern day management of businesses[156]. Competitive corporations have to take corporate governance seriously if they are to invest wisely.

            In the same way, financial markets which are seeking efficiency also have to implement strong corporate governance measures[157].  The interest in corporate governance has been informed by two sets of conditions. It has emerged that the financial structure of the world as an economy was weakened by the financial crisis of 1998 because of poor corporate governance. Similarly, the scandals in corporate governance such as the collapse of Enron [158]and WorldCom in Europe have had the effect of eroding the confidence of the public in corporate governance. This has implication that the collapse Enron was a clear indication of how bad corporate governance can lead to massive insolvency and eventual winding up of a company[159]. These events indicate how serious corporate governance is. We therefore analyze the findings of this study based on each of the various hypotheses as follows.

4.1       Hypothesis One: The Privatization of Property In Albania Through The Voucher System Has Brought Significant Merits To The Companies Which Have Been Privatized.
The first hypothesis in this study was that privatization in Albania through voucher system has brought merits to the companies which have been privatized. From the review of literature, it was established that even though the voucher system was introduced to enhance privatization of state owned enterprises in Albania, it does not entirely come with only positive benefits. The voucher system was used as an alternative to cash payment system in the capital market but brought with it so many burdens to the capital market users[160]. This implies that the use of voucher system in privatization was associated with various disadvantages.

            One challenge which was experienced by the corporations which had privatized through the voucher system was the costs of establishing the voucher systems[161]. From the review of literature, it was established that in the long-run the voucher scheme did not have any significant merits to the users. This implies that privatization through the voucher systems is a loss not only to the corporations which had been privatized but also to the society at large. Other than the costs, the literature review also established that the application form for voucher system and the whole process was relatively complicated to the users as compared to cash system. Similarly, in the course of privatization using the voucher system, a special effort was made towards effectively solving the disagreements in the social-economy, sustaining the speed at which the economy was recapitalizing in relation to the prevailing position of the social economy.

            This implies that during privatization, a deliberate attempt was made towards orienting not only the society but also the economy of Albania in the direction of a socio-economic market. Unfortunately, this endeavour has not yielded any positive results. Many corporations in Albania are still faced with reality of having to retrench their organizational human resources. This reality to downsize is especially supposed to take place in the areas of administration[162]. Unfortunately, many corporations in Albania tend to retrench employees only in the area of production. All these are negative impacts which have come about as a result of privatization through the voucher system. This research therefore fails to reject the null hypothesis one that the privatization of property in Albania through the voucher system has not brought significant merits to the companies which have been privatized.

4.2       Hypothesis Two: The Voucher System Had A Sidelining Effect On Foreign Investors Because Of Its Politically Inclined Policies.
The second hypothesis in this study of corporate governance codes and foreign investments: the infancy of the Albanian corporate governance was that the voucher system had a sidelining effect on foreign investors because of its politically inclined policies. From the literature review, it was established that the voucher system did not favor foreign investors at all. This is because the policies that were used to govern voucher scheme operations were more political rather than social. This simply means that as opposed to the cash or sale systems, the voucher system only went along way in alienating the foreign investors. For instance, the voucher system denied the foreign investors the ownership of public enterprises in order to inhibit them from the control of public resources[163].

            Moreover, the voucher system use required increased training of the capital users to limit the errors. In many circumstances, the auction staff were not qualified and so ended up committing many errors that led to wastage or mismanagement of the public resources. Similarly, the voucher system only made the foreign investors who wanted to use cash in the locally owned businesses to be viewed with suspicions[164]. The local citizens of Albania were in doubt concerning the sources where the foreign investors were receiving their money as to want to pay in cash even for highly valuated assets. These factors jointly contributed towards alienating the foreign investors. Therefore, this study confirmed the second hypothesis that the voucher system had a sidelining effect on foreign investors because of its politically inclined policies thereby rejecting the null hypothesis.

4.3       Hypothesis Three: In Spite Of Its Perceived Advantages, The Voucher System Is A Stumbling Block To Equity And Equal Opportunities In Investment.
The third hypothesis in this study of corporate governance codes and foreign investments: the infancy of the Albanian corporate governance was that in spite of its perceived advantages, the voucher system is a stumbling block to equity and equal opportunities in investment. The review of literature highlighted that the voucher system is associated with dispersed ownership. This implies that use of the voucher system necessitate the collective responsibility of all the corporate stakeholders owing to the tendency to pool all the finances together. However, it should be recalled that the voucher system necessitate the establishment of an extra market[165]. This new market is meant to act as the market where bidders of the voucher are meant to auction their vouchers.

            Cresting this new market has a cost implication which according to analysts is a sunk cost. This implies that the money spent on the creation of this new market will have been wasted after the end of the auctioneering procedure simply because the voucher market is not permanent. Moreover, the voucher is associated with several other fixed cots such as design costs, cost of infrastructure development, cost of education and the costs of bidding[166]. To the society of foreign investors, using the voucher system would mean additional costs of learning the way the system operates only to discard it and learn another one as soon as the tendering process is accomplished. Simply put, the voucher system has various costs which are even more prohibitive to the society of foreign investors.

            This problem of unfamiliarity with the local capital markets was clearly illustrated in Albania. Going by the reports from the embassy of America in Tirana, there were various loopholes in the procedure of voucher systems which were a stumbling block to the procedure of privatization[167]. The biggest problem was the deficiency in information; understaffing and poorly resourced auction markets. Finally the other challenge was the inability to issue vouchers. With the general society of foreign investors lacking information relating to businesses as well as the auctioneering procedure, the voucher system was a hindrance to investment especially to the foreign investors. This study has therefore rejected the null hypothesis three instead confirming the third hypothesis that in spite of its perceived advantages, the voucher system is a stumbling block to equity and equal opportunities in investment.

4.4       Hypothesis Four: Foreign Investments Codes Are Stimulants Which Can Go Along Way In Boosting Foreign Investments.
The fourth hypotheses in this study of corporate governance codes and foreign investments: the infancy of the Albanian corporate governance was that foreign investments codes are stimulants which can go along way in boosting foreign investments. The literature review highlighted the fact that Albania has been slow in directly receiving foreign investors. This inability to attract foreign direct investors has been attributed to a relatively unstable political environment, poor cross-country trade with other Balkan economies, as well as the limited size of the local markets[168]. Given that Albania is a transition economy, keen analysts are quick to observe that Albania might not benefit from net inflows in capital. Analysts observe that this is likely to take place not only in the short-run but also in the medium-run.

            The literature review also noted that through privatization, corporate governance has undergone metamorphosis to earn a place in the even among the corporations which were in the past managed by the government. This implies that corporations are tiring to the market as sources of capitalization while partnership businesses are transforming into quoted companies. In the same way, market-oriented investment procedures are beginning to be norm amongst many of these corporations. These changes have been based on more effective corporate governance practices[169]. These transformations have necessitated the need to have systematic regulations which should cut across all the South Eastern Europe (SEE) nations.

            Specifically, these developments have led top the formation of corporate governance codes. It means that corporate governance codes have been developed with the intention of addressing all the country’s unique challenges of corporate governance. These codes are expected to act as an extra force in reinforcing the efforts of other global organizations such as the principles of governing corporations stipulated by the OECD[170]. It is widely accepted that transition economies such as Albania are faced with serious challenges[171] arising from ineffective legal procedures and graft. The ineffective legal procedure implies that the Albania generally faces a lot of delays in its resolving business conflicts which the end, inhibit foreign investors. Therefore, by implementing codes to streamline corporate governance, Albania can go along way in boosting its foreign investments. This therefore conforms to our fourth hypothesis that foreign investments codes are stimulants which can go along way in boosting foreign investments. In this case, we reject the null hypotheses four.

4.5       Hypothesis Five: Legislation Plays A Defensive Role In Shielding Foreign Investments And Minority Shareholders.
The fourth hypotheses in this study of corporate governance codes and foreign investments: the infancy of the Albanian corporate governance was that legislation plays a defensive role in shielding foreign investments and minority shareholders. Legislation in Albania was meant to bring efficiency and effectiveness in corporate governance in the state owned enterprises just as it was done in the UK through implementation of various codes[172]. From the literature, it has been established that legislation has favoured the minority shareholders through implementation of policies that protect all shareholders from any source or king of abuse.

Researches reveal that shareholders protection is very fundamental to prevent expropriation of the minority shareholders, foreign investors and creditors leading to improved control and management of the shareholders performance[173]. The Albanian companies are governed by the French model Laws, which stresses on the creditor protection through improved policies and regulations on capital market maintenance. Legislation has therefore protected the foreign investors and minority shareholders through the imposed restrictions on state owned companies to ensure equity and equality[174]. This has translated to increased investment rates in the domestic markets and overseas. Albanians have encouraged foreign investment in the country through sales and foreign direct investments more than before in order to rejuvenate their economy.

 It has been established that, the emergence and adoption of the OECD principles in Albania have led to increased stability in the economy. Although the voucher system was not efficient, it was established that it was an alternative payment scheme to the Albanians aimed for protecting the local investors’ interests[175]. The Albanians implemented voucher scheme to ensure equity amongst shareholders particularly the local investors. This was because the foreign investors would take advantage of the situation to bargain for ownership of public properties at relatively low costs because the paid in cash which was not possible with the local investors having experienced many losses due to socio-political instabilities in the country[176]. The set of rules formed to be applied whether locally or internationally or just bespoke to a particular company are aimed at promoting shareholders interests particularly the minority shareholders and foreign investors to avoid any conflicts and promote transparency[177].

From the studies, it has been established that legislation has been used in many countries such as Poland and Czech Republic to ensure investors or shareholders protection. This is because without the shareholders protection a country cannot economically develop. It is therefore necessary to accept the fifth hypothesis of this study that suggests that legislation plays a defensive role in shielding foreign investments and minority shareholders. It is through legislation that the Albanians will be able to determine the rights of various classes of shareholders to provide them with equal treatments and opportunities. Property ownership has been associated with many corruption issues particularly the public properties that in most cases have been associated with ill-gotten money or corruptions in government. It is through legislation that the public will be able to access the right information about the state owned properties as members or shareholders[178].

5.0       Chapter 5: Conclusion

            Corporate governance codes and foreign investment in Albania are still and requires a lot of nurturing to ensure economic rejuvenation and stability[179]. This is due to the series of political crisis that they have faced for decades leading to many destructions and decline in economies of scale. Albania has struggled with implementation of different initiatives to improve on its economy all in vein. This is because other than the political instabilities, Albanians have been very reluctant in implementing security and regulation policies through which efficiency and effectiveness of operations can be achieved. The Albanians have formed round table committees as proposed by the OECD for corporate governance to respond to the increasing awareness of the policy makers and the shareholders on the necessity of corporate governance[180].

The roundtable meetings in the South East Europe has enabled Albania to improve on its proximity thereby allowing its citizens to get access to the international news or information leading to increased developments opportunities. The roundtable initiatives were regional initiatives formed with an aim of improving investment compact or economic reform activities such as economic reconstruction, development and corporation amongst stakeholders[181]. A white paper on corporate governance on has been proposed for the Albanians with certain legislatives and regulatory measures that will lead to increased support to the business and stock exchange sectors hence enhance corporate governance in the country[182].

  There are codes that have been used in different countries in the United Kingdom leading to remarkable improvements in the capital market and Albania apparently lacks the codes. Through the roundtables, Albania has the potentiality of achieving improved corporate governance to strengthen the capital markets, improve on investments and economic growth in various areas including effective implementation of policies to govern corporate governors[183]. In addition, Albania will be able to come up with strategies through which it can be committed to privatise its state owned properties especially the board of directors to facilitate corporate governance reforms.

Improved corporate governance in Albania will lead to improve information flow to facilitate disclosure of the financial and any public enterprise information such as auctioning of a state-owned enterprise. There are key problems that have been experienced with the corporate governance in privatisation and transitioning processes in the companies particularly in nations where state ownership is still being practised for example in Albania[184]. Albania for a very long time rejected privatisation of public properties and foreign investments. Presently, Albania has been encouraging privatisation through voucher system and foreign direct investments with Greece and Italy being best two foreign investors. Albania has been faced with many challenges in its attempt to transition ranging from social to financial and security issues.

Albania has survived many decades of hardship with a dysfunctional legal system leading to increased number of corruption and unlawful operations. Albania has experienced a constrained budget because the socialist enterprises were not well established as the administrative units and in most cases provided for the citizens to ensure no foreign investment practices applied. In addition, Albanians economic backbone was in the undeveloped industry where the socialist regime controlled and managed the operations unfairly to be wealthy within a short time[185]. Albania had no common borders to control its natural resources or territories from destruction by the foreigners and it is located far away from the western developed worlds. Albania has improved a lot from and still has the potentiality for quality improvements provided security or law and regulatory infrastructures will be well implemented for facilitate collaboration or corporation and information sharing[186].

6.0       References

Arben, M. and Fatmir, M. Strategic Privatisation, its Achievements and Challenges,

January 2003.

Armitage, A., & Keeble-Ramsay, D., The Rapid Structured Literature Review as

a Research Strategy, US-China Education Review, vol 6, no. 4,  (2009), pp. 1-36.

Antczak, M. Koszty spowolnienia prywatyzacji (The costs of the deceleration of

Privatization), in Koszty spowolnienia prywatyzacji, Zeszyty BRE Bank – CASE no. 70, Warsaw: CASE, 2004.

Berglöf, E., & Claessens, S., Enforcement and Corporate Governance, World Bank

Policy Research Working Paper No. 3409, 2004.

Berglof, E., & Pajuste, A., Emerging Owners, Eclipsing Markets? Corporate

Governance in Central and Eastern Europe, in P. Cornelius and B. Kogut, Global Competitiveness and Corporate Governance, Oxford University Press, 2003, pp. 267-302.

Berglöf, E., & von Thadden, E., The Changing Corporate World Paradigm, in

Pleskovic and Stiglitz (eds.) World Development Conference, The World Bank, 2000.

Bezemer, J.D. Post-socialist financial fragility: the case of Albania. (Cambridge Journal

of Economics: ABI/INFORM Global, January 25th), 2001, pp. 1-23.

Blaszczyk, B., Gorzynski, M., Kaminski, T., Paczoski, B., Poland II: Ownership

and Performance of the National Investment Funds and Their Portfolio Companies, in B. Blaszczyk, I. Hoshi, R. Woodward (eds.), Secondary Privatisation in Transition Economies: The Evolution of Enterprise Ownership in the Czech Republic, Poland and Slovenia, Basingstoke and New York: Palgrave Macmillan, 2003.

Bobirca, A. and Miclaus, P. Corporate Governance: A South Eastern Perspective, Munich

Personal RePEc Archive, 2007. [Viewed on 18th July 2009] Available at < http://mpra.ub.uni-muenchen.de/3272/1/MPRA_paper_3272.pdf>

Bobirca, A. and Miclaus, P. Extensiveness and Effectiveness of Corporate Governance

Regulations in South Eastern Europe. [Viewed on 18th July 2009] Available at < http://www.waset.org/ijhss/v1/v1-1-2.pdf> .

Bryce, R., Pipe Dreams: Greed, Ego, and the Death of Enron, Public Affairs,

New York, 2002.

Cadbury, A., Corporate Governance and Chairmanship, a personal view (Oxford

University Press), 2002.

Cadbury, A., ‘The Corporate Governance Agenda’, Corporate Governance, Vol.8 (1),

2000, pp.7-15.

Capaul, M. and Frémond, O., The State of Corporate Governance, Experience from

Country Assessments, (WB Policy Research Working Paper, n°2858, June), 2002.

Denyer, D., & Tranfield, D. Using Qualitative Research Synthesis to Build an

Actionable Knowledge Base, Management Decision, vol. 44, no. 2 (2006), pp. 213-227.

Dick, B. 2000, Grounded Theory:  A Thumbnail Sketch, Research Papers in

Action Research, 1995 Retrieved July 16, 2009 from <http://www.scu.edu.au/schools/gcm/ar/arp/grounded.html >

Dimitrov, M., Gedeshi, I., Slaveski, T. Petrakos, G. Totev, S. and Boyadjieva, M. “Cross-

border Cooperation in South-eastern Europe: A Survey of Enter- prises in Border Regions.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.

DTI., Modern Company Law for a Competitive Economy: Final Report, London: DTI,

2001.

Djankov, S. and Murrell, P., Enterprise Restructuring in Transition: A Quantitative

Survey, Journal of Economic Literature 40(3), 2002, pp. 739-792.

Doing Business. Albania Doing Business: Country Profile for Albania, 2009

Ernst, D., What permits David to grow in the shadow of Goliath? The Taiwanese model

in the computer industry, in M. Borrus, D. Ernst, S. Haggard (eds.), International Production Networks in Asia: Rivalry or riches? London, New York : Routledge, 2000.

Elis, T. Protection of creditors in public limited companies: Second Council Directive

and Albanian Company Law Compared. Is there a need for reform? 2003. [Viewed on 12th July 2009] Available at < http://ssrn.com/abstract=1130311>

European Commission, Directorate-General for Economic And Financial Affairs, The

Western Balkans in Transition, 2002.

Fink, A., Conducting Research Literature Reviews, London: Sage, 2005.

Fox, L., Enron: The Rise and fall, John Wiley & Sons, Hoboken, New

Jersey, 2003.

FRC., The Combined Code on Corporate Governance July 2003, London: Financial

Reporting Council, 2003.

Frye, T. and Mansfield, E. D. Fragmenting Protection: The Political Economy of the

Trade Policy n the Post-Communist World, Cambridge University Press DOI: 1.0017/S00071234000292, 2003.

Goldstein, M. A. Privatization Success and Failure: Finance Theory and Regulation in the

Transitional Economies of Albania and the Czech Republic Managerial and Decision economics, Vol. 18, No. 7/8, The Use of Finance and Economics in Securities Regulation and Corporation Law (John Wiley & Sons: Nov. – Dec.), 1997, pp. 529-544. [Viewed on 12th July 2009] Available at <http://www.jstor.org/stable/3108218>

Goldstein,M.A., & Gultekin, N. B., Eastern European Privatization: A Theoretical

Analysis, Privatization and Financial Sector Reform in Transition Economies. In Advances in Finance, Investment and Banking (edited by J. Doukas, V. Murinde and C. Wihlborg), Amsterdam: Elsevier, Chapter 12, 281-325, 1997.

Haig, B., Grounded Theory as Scientific Method, Philosophy of Education

Yearbook, 1995 Retrieved July 16, 2009 from

< http://www.ed.uiuc.edu/EPS/PES-Yearbook/95_docs/haig.html >

Hammersley, M., Systematic or Unsystematic, Is That the Question? Some Reflections

on the Science, Art and Politics of Reviewing Research Evidence, Talk Given to the Public Health Evidence Steering Group of the Health Development Agency, 2002.

Hashi, I. and Xhillari, L. Privatization and Transition in Albania, Post-Communist

Economies, Vol.11, No. 1 Carfax Publishing, 1999

Herbert, P. and Dulewicz, V., Does the Composition and Practice of UK Boards Bear

any Relationship to the Performance of Listed Companies?, Henley Working Paper 0304, 2003.

Higgs, D., Review of the role and effectiveness of non-executive directors, London: DTI.

 2003.

HM Treasury., Institutional Investment in the United Kingdom: A Review [Myners

Report, 2001], London: HM Treasury, 2001

ICEAW., Internal Control – Guidance for Directors on the Combined Code [Turnbull

Report], London: Institute of Chartered Accountants in England and Wales,1999

IDRA Study – FDI in Balkan Countries, 2000.

IDRA Paper – Comparative analysis of Family Farms in three geographical zones of

Albania, 2001.

Jones, I. and Pollitt, M., Understanding how issues in Corporate Governance Develop:

Cadbury Report to Higgs Review, ESRC Centre for Business Research, University of Cambridge Working Paper No. 277, 2003.

Jones, I.W. and Pollitt, M.G., ‘Who Influences Debates in Business Ethics? An

Investigation into the Development of Corporate Governance in the UK since 1990′ in I.W. Jones and M.G.Pollitt (eds.), Understanding How Issues in Business Ethics Develop, Basingstoke: Palgrave, 2002a.

Jones, I.W. and Pollitt, M.G., ‘Understanding How Issues in Business

Ethics Develop: Lessons for Business’ in I.W. Jones and M.G.Pollitt (eds.), Understanding How Issues in Business Ethics Develop, Basingstoke: Palgrave, 2002b.

Kaufmann, D., Kraay, A., Mastruzzi, M., Governance Matters VI: Governance Indicators, for 1996-2006, Washington DC: World Bank Institute, 2007.

Knafl, K. A., & Breitmayer, B. J., Triangulation in Qualitative Research: Issues of

Conceptual Clarity and Purpose. In Qualitative Research: A Contemporary Dialogue, edited by J. M. Morse. Newbury Park: Sage Publications, 1991.

Malaj, A. and Mema, F. Albanian Privatization, Strategic Privatization, its achievements

and challenges, 2003.

Mançellari, A., Mytkolli, H. and Kola, T. Exchange rates and Economic Transition,

 TOENA 1999.

 Mançellari, A., Xhepa, S. and  Mytkolli, H.  Tranzicioni dhe Stabilizimi Makroekonomik,

paper presented in the Conference: The Future of Albania and the Albanians”, Tiranë , November 1999.

Mançellari, A. and  Xhepa, S.  Trade and Economic Development, 2002

Marta, M., Sanfey, P. and Taci, A. Inflation, Exchange rates and the role of monetary

policies in Albania. Working Paper No. 88, 2004.

McNulty, T., Roberts, J. and Stiles, P., Creating Accountability within the board: the

work of the effective non-executive director, London: DTI, Higgs Review, 2003.

Minassian, A. “Economic Environment in Albania, Bulgaria, FYR of Macedonia, and

Greece: Cross-Country Study.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.

Mori., Review of the role and effectiveness of non-executive directors, London: DTI,

Higgs Review, 2003.

Nusser, M. The Implications of Wage Structure Rigidity on Human Capita

Accumulation, Economic Growth and Unemployment: A Schumpeterian Approach to Endogenous Growth Theory, March 1999.

OECD. OECD principles of Corporate Governance, Organization for Economic Co-

Operation and Development, 2004.

 OECD. Albanian Corporate Governance East OECD: Stability Pact South East Europe

Compact for reform, investment, integrity and growth. White paper on Corporate Governance in South East Europe, 2003.

OECD., Principles of Corporate Governance, Business Sector Advisory Group on Corporate Governance, Ira Millstein Chairman, Paris: OECD,1999.

Parkinson, J., ‘Inclusive Company Law’, in J. de Lacy (ed.), The Reform of Company

Law in the UK, London: Cavendish, 2002

Pasha, A., Mancellari, A., Dumani, B., Babameto, E. and Salko, D. Determinants of

growth: Albania Case, IDRA Team, 2002.

Schekulin, M., Geiger, R. and Diaconescu, C. Stability Pact, South East Europe Compact for Reform, investment, integrity and growth: White Paper on Corporate Governance in South East Europe. [Viewed on 18th July 2009] Available at < http://www.investment.gov.eg/NR/rdonlyres/16D52EBB-683A-426B-89E6-FB016D57B133/1855/UNPAN017922.pdf>

Selami X., Euroization of Economy, An alternative to be considered , Discussion paper,

Banka e Shqipërisë, shkurt 2002.

Smith, R., Audit Committees Combined Code Guidance [Smith Report], London:

Financial Reporting Council, 2003

Shkëlqim, C. Monetary Policy: Analytical Overview of the Past and Vision Toward the

Future, Albania between domestic reforms and European integration, Bank of Albania, 2001

Slaveski, T. and Nedanovski, P. Foreign Direct Investment in the Balkans. The Case of

Albania, FYROM, and Bulgaria. Eastern European Economics, vol. 40, no. 4, July-August 2002, pp. 83-99.[Viewed on 15th July 2009] Available at <http://www.jstor.org/stable/4380306>

Sulo, H. Papapanagos, H. Sanfey, P. and Talka, M, Inflation and Stabilisation in Albania,

Post Comunist Economies, Vol. 11, No. 1, 1999.

Ramamurti, R. A Multilevel Model of Privatization in emerging economies. Academy of

Management Review Vol. 25, No. 3, 2000, pp. 525-550.

Ramamurti, R. Why haven’t developing countries pri- vatized deeper and faster? World

Development, Vol. 27, 1999, pp. 137- 155.

Survey of Corporate Governance Developments in OECD Countries, 2003.

Totev, S., Slaveski, T. Gedeshi, I., Petrakos, G. and Boyadjieva, M. “Eco- nomic

Relations in South Eastern Europe: The Intra-regional FDI Point of View.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.

Volker, T.  Stabilization Policies and Structural reforms in Albania Since 1997-

Achievements and remaining Challenges, IFM Policy Discussion Paper, 2002.

Volker, T. Unemployment in Reforming Countries: Causes, Fiscal Impacts and the

Success of Transformation, July 1999.

Zikmund, W.G., Business Research Methods, 7th Ed., Thomson South-Western, 2003, pp. 1-745

Appendix
Figure 1: Summary of Recommendations of the Cadbury and Higgs Reports

[1] D. Kaufmann, A. Kraay, M. Mastruzzi, Governance Matters VI: Governance Indicators for 1996-2006, Washington DC: World Bank Institute, 2007.
[2] OECD, Albanian Corporate Governance East OECD: Stability Pact South East Europe Compact for reform, investment, integrity and growth. White paper on Corporate Governance in South East Europe, 2003.
[3] OECD. Principles of Corporate Governance, 1999.
[4] OECD., Op.cit.
[5] Survey of Corporate Governance Developments in OECD Countries, 2003.
[6] OECD., Op. cit.

[7] OECD. OECD principles of Corporate Governance, Organization for Economic Co-Operation and Development, 2004
[8] OECD., Op. cit.
[9] Ibid.
[10] Ibid.
[11]Ibid.
[12] M. Capaul, and O. Frémond, The State of Corporate Governance, Experience from  Country Assessments, (WB Policy Research Working Paper, n°2858, June), 2002
[13] J.D. Bezemer. Post-socialist financial fragility: the case of Albania. (Cambridge Journal of Economics: ABI/INFORM Global, January 25th), 2001, pp. 1-23.
[14]  Ibid., pp. 1-23.
[15] Ibid., pp. 1-23.
[16] M. A. Goldstein. Privatization Success and Failure: Finance Theory and Regulation in theTransitional Economies of Albania and the Czech Republic Managerial and Decision Economics, Vol. 18, No. 7/8, The Use of Finance and Economics in Securities Regulation and Corporation Law (John Wiley & Sons: Nov. – Dec.), 1997, pp. 529-544. [Viewed on 12th July 2009] Available at <http://www.jstor.org/stable/3108218>
[17]Ibid., pp. 529-544.
[18] Ibid., pp. 529-544.
[19] Ibid., pp. 529-544.
[20] Ibid., pp. 529-544.
[21] Ibid., pp. 529-544.
[22] Ibid., pp. 529-544.
[23] Ibid., pp. 529-544.
[24]Ibid., pp. 529-544.
[25] Ibid., pp. 529-544.
[26] Ibid., pp. 529-544.
[27]Ibid., pp. 529-544.
[28]Ibid., pp. 529-544.
[29] Ibid., pp. 529-544.
[30] Ibid., pp. 529-544.
[31] Ibid., pp. 529-544.
[32] Ibid., pp. 529-544.
[33] Ibid., pp. 529-544.
[34] X.Selami, Euroization of Economy, An alternative to be considered , Discussion paper, Banka e Shqipërisë, shkurt 2002
[35] B. Blaszczyk, M. Gorzynski, T.Kaminski, and B. Paczoski. Poland II: Ownership and Performance of the National Investment Funds and Their Portfolio Companies, in B. Blaszczyk, I. Hoshi, R. Woodward (eds.), Secondary Privatisation in Transition Economies: The Evolution of Enterprise Ownership in the Czech Republic, Poland and Slovenia, Basingstoke and New York: Palgrave Macmillan, 2003.

[36] M. A. Goldstein., Op. cit., pp. 529-544.
[37] A. Pasha, A. Mancellari, B. Dumani, E. Babameto, and D. Salko, Determinants of growth: Albania Case, IDRA Team, 2002.
[38] A. Cadbury, Corporate Governance and Chairmanship, a personal view (Oxford University Press), 2002
[39] Albania Accounting and Auditing. Report on the observance of standard and codes (ROSC), 2006. [Viewed on 16th July 2009] Available at <http://www.c-bs.org/standards.htm>
[40] R. Ramamurti, A Multilevel Model of Privatization in emerging economies. Academy of Management Review Vol. 25, No. 3, 2000, pp. 525-550.
[41] M. Antczak, Koszty spowolnienia prywatyzacji (The costs of the deceleration of privatization), in Koszty spowolnienia prywatyzacji, Zeszyty BRE Bank – CASE no. 70, Warsaw: CASE, 2004.
[42] A. Malaj and F. Mema, Albanian Privatization, Strategic Privatization, its achievements and challenges, 2003
[43]Ibid.
[44] Ibid.
[45] Ibid.
[46] Ibid.
[47] Ibid.
[48] Ibid.
[49] Ibid.
[50] R. Ramamurti, A Multilevel Model of Privatization in emerging economies. Academy of Management Review Vol. 25, No. 3, 2000, pp. 525-550.
[51] Ibid., pp. 137- 155.
[52] A. Malaj and F. Mema, Op. cit.,
[53] M. Arben, and M.  Fatmir, Strategic Privatisation, its Achievements and Challenges, January 2003.
[54] Ibid.,
[55] Ibid.,
[56] Ibid.,
[57] Ibid.,
[58] Ibid.,
[59] Ibid.,
[60] Ibid.,
[61] I. Jones, and M. Pollitt, Understanding how issues in Corporate Governance Develop: Cadbury Report to Higgs Review, ESRC Centre for Business Research , University of Cambridge Working Paper No. 277, 2003.
[62] I.W. Jones, and M.G. Pollitt, ‘Who Influences Debates in Business Ethics? An Investigation into the Development of Corporate Governance in the UK since 1990’ in I.W. Jones and M.G.Pollitt (eds.), Understanding How Issues in Business Ethics Develop, Basingstoke: Palgrave, 2002a
[63] I.W. Jones, and M.G. Pollitt, ‘Understanding How Issues in Business Ethics Develop: Lessons for Business’ in I.W. Jones and M.G.Pollitt (eds.), Understanding How Issues in Business Ethics Develop, Basingstoke: Palgrave, 2002b
[64] ICEAW., Internal Control – Guidance for Directors on the Combined Code [Turnbull Report], London: Institute of Chartered Accountants in England and Wales,1999
[65] P. Herbert, and V. Dulewicz, Does the Composition and Practice of UK Boards Bear any Relationship to the Performance of Listed Companies?, Henley Working Paper 0304, 2003
[66] A. Cadbury, ‘The Corporate Governance Agenda’, Corporate Governance, Vol.8 (1), 2000, pp.7-15

[67] DTI., Modern Company Law for a Competitive Economy: Final Report, London: DTI, 2001
[68] FRC., The Combined Code on Corporate Governance July 2003, London: Financial Reporting Council, 2003
[69] J. Parkinson, ‘Inclusive Company Law’, in J. de Lacy (ed.), The Reform of Company Law in the UK, London: Cavendish, 2002
[70] D. Higgs, Review of the role and effectiveness of non-executive directors, London: DTI. 2003.
[71] HM Treasury.,  Institutional Investment in the United Kingdom: A Review [Myners Report, 2001], London: HM Treasury, 2001
[72] R. Smith, Audit Committees Combined Code Guidance [Smith Report], London: Financial Reporting Council, 2003
[73] T. McNulty, J. Roberts, and P. Stiles, Creating Accountability within the board: the work of the effective non-executive director, London: DTI, Higgs Review, 2003
[74] Mori., Review of the role and effectiveness of non-executive directors, London: DTI, Higgs Review, 2003

[75] M. Schekulin, R. Geiger, and C. Diaconescu, Stability Pact, South East Europe Compact for Reform, investment, integrity and growth: White Paper on Corporate Governance in South East Europe. [Viewed on 18th July 2009] Available at < http://www.investment.gov.eg/NR/rdonlyres/16D52EBB-683A-426B-89E6-FB016D57B133/1855/UNPAN017922.pdf>
[76] T. Elis. Protection of creditors in public limited companies: Second Council Directive and Albanian Company Law Compared. Is there a need for reform? 2003. [Viewed on 12th July 2009] Available at < http://ssrn.com/abstract=1130311>
[77]Ibid.,
[78] Ibid.,
[79] Doing Business. Albania Doing Business: Country Profile for Albania, 2009
[80] OECD. OECD principles of Corporate Governance, Organization for Economic Co-Operation and Development, 2004.
[81] Ibid.,
[82] Ibid.,
[83] Ibid.,
[84] Ibid.,
[85] I. Hashi, and L. Xhillari, Privatization and Transition in Albania, Post-Communist Economies, Vol.11, No. 1 Carfax Publishing, 1999
[86] Ibid.,
[87] Ibid.,
[88] Ibid.,
[89] Ibid.,
[90] M. Nusser, The Implications of Wage Structure Rigidity on Human Capital Accumulation, Economic Growth and Unemployment: A Schumpeterian Approach to Endogenous Growth Theory, March 1999
[91]Ibid.,
[92]Ibid.,
[93] T.  Volker, Stabilization Policies and Structural reforms in Albania Since 1997-Achievements and remaining Challenges, IFM Policy Discussion Paper, 2002.
[94] Ibid., pp. 83-99.
[95] A. Pasha, A. Mancellari, B. Dumani, E. Babameto, and D. Salko, Determinants of growth: Albania Case, IDRA Team, 2002.
[96] M. Marta, P. Sanfey, and A. Taci, Inflation, Exchange rates and the role of monetary polices in Albania. Working Paper No. 88, 2004.
[97] I. Hashi, and L. Xhillari, Op. cit.,
[98]H. Sulo, H. Papapanagos, P. Sanfey & M. Talka, Inflation and Stabilisation in Albania, Post Comunist Economies, Vol. 11, No. 1, 1999.
[99]I.  Hashi, and L. Xhillari, Op.cit.
[100] Ibid.,
[101]A. Mançellari, H. Mytkolli, and T. Kola, Exchange rates and Economic Transition, TOENA 1999.
[102] I. Hashi, and L. Xhillari, Op. cit.,
[103] Ibid.,
[104] Ibid.,
[105] Ibid.,
[106]S. Totev, T. Slaveski, I. Gedeshi, G. Petrakos, and M. Boyadjieva, “Eco- nomic Relations in South Eastern Europe: The Intra-regional FDI Point of View.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.
[107] I. Hashi, and L. Xhillari, Op.cit.,
[108] A. Mançellari, S. Xhepa, H. Mytkolli, Tranzicioni dhe Stabilizimi Makroekonomik, paper presented in the

Conference: The Future of Albania and the Albanians”, Tiranë , November 1999.
[109] I.  Hashi, and L. Xhillari, Op.cit.
[110] Ibid.,
[111] Ibid.,
[112] S. Djankov, and P. Murrell, Enterprise Restructuring in Transition: A Quantitative Survey, Journal of Economic Literature 40(3), 2002, pp. 739-792.
[113] M. Marta, P.  Sanfey, and A. Taci, op.cit.,
[114] Ibid.,
[115] Ibid.,
[116]M. Dimitrov., I. Gedeshi., T. Slaveski,. G.  Petrakos,.  S. Totev, and M. Boyadjieva. “Cross-border Cooperation in Southeastern Europe: A Survey of Enter- prises in Border Regions.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.
[117]T.  Slaveski. and  P. Nedanovski. Foreign Direct Investment in the Balkans. The Case of Albania, FYROM, and Bulgaria. Eastern European Economics, vol. 40, no. 4, July-August 2002, pp. 83-99.[Viewed on 15th July 2009] Available at < http://www.jstor.org/stable/4380306 >
[118] S. Totev, T. Slaveski, I. Gedeshi, G. Petrakos, and M. Boyadjieva, “Eco- nomic Relations in South Eastern Europe: The Intra-regional FDI Point of View.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.
[119] A.  Minassian. “Economic Environment in Albania, Bulgaria, FYR of Macedonia, and Greece: Cross-Country Study.” Paper prepared for the final report of the PHARE ACE Project P97-8196-R, Overcoming Isolation, 2001.
[120] T.  Slaveski. and  P. Nedanovski. Foreign Direct Investment in the Balkans. The Case of Albania, FYROM, and Bulgaria. Eastern European Economics, vol. 40, no. 4, July-August 2002, pp. 83-99.[Viewed on 15th July 2009] Available at < http://www.jstor.org/stable/4380306 >
[121] M. Dimitrov, I. Gedeshi, T. Slaveski, G.  Petrakos,  S. Totev, and M. Boyadjieva, op.cit.,
[122] T.  Slaveski. and  P. Nedanovski., Op.cit., pp. 83-99.
[123] IDRA Study – FDI in Balkan Countries, 2000
[124] A.  Minassian., Op. cit.,
[125] Ibid.,
[126] T.  Slaveski. and  P. Nedanovski. Op.cit., pp. 83-99.
[127] European Commission, Directorate-General for Economic And Financial Affairs, The Western Balkans

in Transition, 2002.
[128]M. Dimitrov,. I.  Gedeshi.,. T. Slaveski,. G. Petrakos,. S. Totev,. and M. Boyadjieva., op.cit.,
[129] T.  Slaveski. and  P. Nedanovski.,op. cit.,  pp. 83-99.
[130]A.  Minassian., op.cit.,
[131]T.   Volker, op.cit.,
[132] A. Pasha, A. Mancellari, B. Dumani, E. Babameto, and D. Salko, op.cit.,
[133] A Mançellari, S. Xhepa, Trade and Economic Development, 2002
[134] D. Ernst, What permits David to grow in the shadow of Goliath? The Taiwanese model in the computer industry, in M. Borrus, D. Ernst, S. Haggard (eds.), International Production Networks in Asia: Rivalry or riches? London, New York : Routledge, 2000.
[135] Marta, M., Sanfey, P. and Taci, A. Inflation, Exchange rates and the role of monetary polices in Albania. Working Paper No. 88, 2004.

[136] T. Volker, Unemployment in Reforming Countries: Causes, Fiscal Impacts and the Success of Transformation, July 1999
[137] A. Pasha, A. Mancellari, B. Dumani, E. Babameto, and D. Salko, op.cit.,
[138] IDRA Paper – Comparative analysis of Family Farms in three geographical zones of Albania, 2001.
[139] C. Shkëlqim, Monetary Policy: Analytical Overview of the Past and Vision Toward the Future, Albania between domestic reforms and European integration, Bank of Albania, 2001
[140] T. Slaveski, and P. Nedanovski, op.cit.,
[141] A. Pasha, A. Mancellari, B. Dumani, E. Babameto, and D. Salko, op.cit.,
[142] A. Pasha, A. Mancellari, B. Dumani, E. Babameto, and D. Salko, op.cit.,
[143] K. A Knafl., B. J. Breitmayer., Triangulation in Qualitative Research: Issues in Conceptual Clarity and Purpose. In Qualitative Research: A Contemporary Dialogue, edited by J.M Morse. Newsbury Park: Sage Publications, 1991.
[144] A. Armitage., & D. Keeble-Ramsay., The Rapid Structured Literature Review as a Research Strategy, US-China Education Review, vol 6, no.4 (2009), pp. 1-36.
[145] Ibid, pp. 1-36.
[146] B. Haig, Grounded Theory as Scientific Method, Philosophy of Education Yearbook, 1995. Retrieved July 16, 2009 from http://www.ed.uiuc.edu/EPS/PES-Yearbook/95_docs/haig.html
[147] Ibid
[148] A. Armitage., & D. Keeble-Ramsay., opcit, pp. 1-36.
[149] A. Fink., Conducting Research Literature Reviews, London: Sage, 2005.
[150] W. G Zikmund., Business Research Methods, 7th Ed., Thomson South-Western, 2003,pp. 1-745.
[151] B. Dick., Grounded Theory: A Thumbnail Sketch, Research Papers in Action Research, 2000. Retrieved July 16, 2009 fromhttp://www.scu.edu.au/schools/gcm/ar/arp/grounded.html
[152] M. Hammersley, Systematic or Unsystematic, Is That the Question? Some Reflections on the Science, Art and Politics of Reviewing Research Evidence, Talk Given to the Public Health Evidence Steering Group of the Health Development Agency, 2002.
[153] A. Fink., op. cit.
[154] K. A Knafl., B. J. Breitmayer., op. cit
[155] D. Denyer & D. Tranfield., Using Qualitative Research Synthesis to Build an Actionable Knowledge Base, Management Decision, vol. 44, no. 2 (2006),pp. 213-227.
[156] E. Berglöf, & E. von Thadden, The Changing Corporate World Paradigm, in Pleskovic and Stiglitz (eds.) World Development Conference, The World Bank, 2000.
[157] E. Berglöf, & Claessens, S., Enforcement and Corporate Governance, World Bank Policy Research Working Paper No. 3409, 2004.
[158] R. Bryce., Pipe Dreams: Greed, Ego and the Death of Enron, Public Affairs, New York, 2002.
[159] L. Fox., Enron: The Risen and Fall, John Wiley & Sons, Hoboken, New Jersey, 2003.
[160] M. A. Goldstein., op.cit.,
[161] M.A Goldstein & N.B Gultekin., Eastern European Privatization: A Theoretical Analysis, Privatization and Financial Sector Reform in Transition Economies. In Advances in Finance, Investment and Banking (edited by J. Doukas, V. Murinde and C. Wihlborg), Amsterdam: Elsevier, Chapter 12, 281-325, 1997.
[162] A. Malaj & F. Mema., op.cit.
[163] M. A. Goldstein., op.cit.,
[164] Ibid., pp. 529-544.
[165] Ibid., pp. 529-544.
[166] Ibid., pp. 529-544.

[167] Ibid., pp. 529-544.

[168] T. Slaveski ., & P. Nedanovski., op.cit
[169] E. Berglof, & A. Pajuste, Emerging Owners, Eclipsing Markets? Corporate Governance in Central and Eastern Europe, in P. Cornelius and B. Kogut, Global Competitiveness and Corporate Governance, Oxford University Press, 2003, pp. 267-302.
[170] Bobirca, A. and Miclaus, P. Corporate Governance: A South Eastern Perspective, Munich Personal RePEc Archive, 2007. [Viewed on 18th July 2009] Available at < http://mpra.ub.uni-muenchen.de/3272/1/MPRA_paper_3272.pdf>
[171] T. Slaveski ., & P. Nedanovski., op.cit
[172] Bobirca, A. and Miclaus, P. Extensiveness and Effectiveness of Corporate Governance Regulations in South Eastern Europe. [Viewed on 18th July 2009] Available at < http://www.waset.org/ijhss/v1/v1-1-2.pdf>
[173] T. Elis, Protection of creditors in public limited companies: Second Council Directive and Albanian Company Law Compared. Is there a need for reform? 2003. [Viewed on 12th July 2009] Available at < http://ssrn.com/abstract=1130311>
[174] Ibid
[175] I.W. Jones, and M.G. Pollitt, ‘Understanding How Issues in Business Ethics Develop: Lessons for Business’ in I.W. Jones and M.G.Pollitt (eds.), Understanding How Issues in Business Ethics Develop, Basingstoke: Palgrave, 2002b
[176] OECD. Albanian Corporate Governance East OECD: Stability Pact South East Europe Compact for reform, investment, integrity and growth. White paper on Corporate Governance in South East Europe, 2003.
[177] Bobirca, A. and Miclaus, P. Corporate Governance: A South Eastern Perspective, Munich Personal RePEc Archive, 2007. [Viewed on 18th July 2009] Available at < http://mpra.ub.uni-muenchen.de/3272/1/MPRA_paper_3272.pdf>
[178] T. Elis, ibid, 2003
[179] T. McNulty, J. Roberts, and P. Stiles, Creating Accountability within the board: the work of the effective non-executive director, London: DTI, Higgs Review, 2003
[180] ICEAW., Internal Control – Guidance for Directors on the Combined Code [Turnbull Report], London: Institute of Chartered Accountants in England and Wales,1999
[181] T. Slaveski, and P. Nedanovski, op.cit.,  pp. 83-99.
[182] E. Berglöf, & S. Claessens, Enforcement and Corporate Governance, World Bank Policy Research Working Paper No. 3409, 2004.
[183] M. Arben, and M. Fatmir, Strategic Privatisation, its Achievements and Challenges, January 2003
[184] A. Bobirca, and P. Miclaus, Corporate Governance: A South Eastern Perspective, Munich Personal RePEc Archive, 2007. [Viewed on 18th July 2009] Available at < http://mpra.ub.uni-muenchen.de/3272/1/MPRA_paper_3272.pdf>
[185] R. Bryce, Pipe Dreams: Greed, Ego, and the Death of Enron, Public Affairs,  New York, 2002
[186] E. Berglof, & A. Pajuste, Emerging Owners, Eclipsing Markets? Corporate Governance in Central and Eastern Europe, in P. Cornelius and B. Kogut, Global Competitiveness and Corporate Governance, Oxford University Press, 2003, pp. 267-302.

 

Haven’t Found A Paper?

Let us create the best one for you! What is your topic?

By clicking "SEND", you agree to our terms of service and privacy policy. We'll occasionally send you account related and promo emails.

Eric from Graduateway Hi there, would you like to get an essay? What is your topic? Let me help you

logo

Haven't found the Essay You Want?

Get your custom essay sample

For Only $13.90/page