For many boardrooms and policy circles around the globe, it is understood that good corporate governance is essential for strong long-term business prospects. It can help organisations improve their performance, gain access to capital and weather fluctuations in the economy.
This understanding has undoubtedly spread across the Middle East, with corporate governance frameworks developing significantly in recent years. Increased enforcement of corporate governance rules and regulations has been particularly noticeable in the region and, for many, establishing sound practices is something that sits at the heart of everything their organisation does and aims to achieve.
Indeed, as the Organisation for Economic Cooperation and Development (OECD) stated in one of its recent corporate governance working papers, in the past three years the practice of following corporate governance principles has emerged as both a policy challenge and a priority for the region. According to the OECD, an emphasis on better enforcement reflects a number of trends, including “political changes in some countries of the region, and the global call for better surveillance of the adoption of governance rules, as well as low investor engagement in the region”.
Governance frameworks and codes now exist in all of the main capital markets, alongside recommendations in company and security law. There are a number of disparities between the regional governance frameworks, in terms of sophistication and depth, but it is evident that governance is a major issue in the Arabic corporate world.
However, despite the significant advancements, there are still concerns about the transparency of frameworks. As Dr Ashraf Gamal, chief executive at Hawkamah (the Institute for Corporate Governance in the MENA region), writes in Ethical Boardroom that transparency is not particularly part of the culture in the region.
Yet, transparency is a key element in building trust among stakeholders and plays a significant role in attracting capital. Corporate sustainability helps to lower a business’s cost of capital and boosts a company’s operating performance. The challenge in the Middle East lies in the governance of state-owned enterprises and instilling a culture of governance to family-owned enterprises. Because many companies are family-owned, governance issues are more complex – even more so as companies grow and markets develop.
For the Middle East, the next stage of good governance will be when organisations focus less on the development of ethical and sustainable policies and more on executing these standards.
Ethical Boardroom is proud to announce the winners of “Best Corporate Governance” in their respective industry sectors across the Middle East for 2015. The awards recognise the outstanding leadership from boards of public companies who have raised the bar to ensure that strong corporate governance plays an essential part in protecting and enhancing long-term value for all stakeholders. Our awards program is a vital part of our continuing mission to elevate corporate governance standards globally.
For those who have made it to the top of the mountain for 2015, we salute you for leading the way.
|Best Corporate Governance||Food & Beverage||Almarai Co|
|Best Corporate Governance||Financial Services||National Bank of Abu Dhabi (NBAD)|
|Best Corporate Governance||Conglomerate||Saudi Basic Industries Corporation (SABIC)|
|Best Corporate Governance||Insurance||RAK Insurance|
|Best Corporate Governance||Transportation||DP World Limited|
|Best Corporate Governance||Telecoms||du Telecom|
|Best Corporate Governance||Mining||Saudi Arabian Mining Company (MA’ADEN)|
|Best Corporate Governance||Industrial Services||Aluminium Bahrain (Alba)|
Please note that the winners for the Americas region will be announced in the Summer 2015 edition.