The Capital Market Authority’s (CMA) new corporate governance regulations that came into effect on Saturday is a significant organizational shift, head of corporate governance, Zaid Al-Mufrih, told Argaam.
“The new system will be a organizational shift that will put Saudi Arabia among the world's leading countries in corporate governance,” he added.
Of the regulations, 98 articles have come into effect while some other provisions will be delayed until the end of this year, as the listed companies still need more time to prepare their bylaws, he said.
Tadawul-listed firms are requested to comply with these rules, but they will only serve as a “benchmark” for companies listed on Nomu Parallel market.
With regard to board bonuses and remuneration under the new structure, Mufrih said they would be determined by shareholders.
“Major shareholders at any company can individually or collectively submit an application to the board chairman for discussing changes to the applicable bonus policy,” Mufrih added.
The Saudi market regulator had earlier said the new rules are focused on shareholders’ rights including fair treatment, non-discrimination, access to information as well as the rights of other stakeholders in Tadawul-listed companies, Argaam reported.
Listed companies are required under the new system to approve restructuring plans and adjust their financial position by December 31, 2017.
