Governance is an important part of the values and practices of Saudi Tadawul Group, in which it seeks to support implementing the best corporate governance practices amongst the subsidiaries. In addition, the Company works towards raising the level of transparency and corporate integrity by maintaining the best governance practices based on the following:
- Companies Law;
- Capital Market Law;
- Corporate Governance Regulations;
- Company By-laws, and
- Regulatory Rules and Procedures issued pursuant to the Companies Law relating to Listed Joint Stock Companies issued by CMA.
As such, the Company has developed a governance manual in accordance with the Corporate Governance Regulations (CGRs) issued by the Capital Market Authority (CMA). The CGRs prescribe the rules and standards to the management of the Company in order to ensure that the Company’s corporate governance standards are in line with best practices enshrining the rights of shareholders and stakeholders. The Company’s internal governance manual that was approved by the Company’s Board of Directors on 29/12/442H (corresponding to 08 August 2021G) includes provisions relating to the following:
- Shareholders’ rights
- Rights related to the General Assembly Meeting
- The Board of Directors, its composition, responsibilities, competencies and work procedures
- Executive Management, its functions and responsibilities
- The Company’s committees, their membership and meetings.
Implemented and non-implemented provisions of the Corporate Governance Regulations
The Company applies all the provisions contained in the Corporate Governance Regulations issued by the Capital Market Authority (“CMA”), except the guiding provision quoted below:
Article 54 –
|The chairman of the audit committee shall be an Independent Director.
|The formation of the Audit committee, which includes more than two independent directors, achieves the independence required by the Corporate Governance Regulations in a way that carries out the committee’s duties.
|If the Board forms a corporate governance committee, it shall assign to it the competences stipulated in Article (94) of these Regulations. Such committee shall oversee any matters relating to the implementation of governance, and shall provide the Board with its reports and recommendations at least annually.
|Referring to Article 50 clause (1) which stipulates that “the Board shall form specialized committees as follows; (1) as may be needed depending on the Company’s circumstances in order to enable it to effectively perform its duties”. The Board of Directors does not see a need to form such specialized committee, since the Board and all its committees are performing their duties in a manner that reflects Corporate Governance principals and in accordance to the provisions of the Governance Manual.