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SCA puts into effect the shareholders’ agent mechanism at general meetings of shareholders, in line with its decision approving the public joint-stock companies’ governance guide

As part of its keen efforts to promote the participation of minority shareholders at general meetings of publicly-traded companies—in line with the best international practices—and to ensure that they take part in decision-making; voice their views; and discuss draft resolutions, the Securities and Commodities Authority (SCA) has taken all actions necessary to bring into effect the articles on the shareholders’ agent provided under the SCA Board Chairman’s Decision No. (3/Chairman) of 2020 Approving the Public Joint-Stock Companies’ Governance Guide.

The mechanism aims primarily to safeguard the rights of minority shareholders and to help them communicate their views and voice their suggestions on corporate activity and financial performance. This move comes to put into effect one of the new governance controls mechanisms outlined in the new governance decision issued this year. It represents a qualitative development in the introduction of voting mechanisms for shareholders, thus helping to evaluate the performance of corporate boards and expand shareholder involvement in passing resolutions at general meetings. The minority shareholders’ agent will act to ensure the common good of minority shareholders and will communicate their interests and concerns.

It is worth noting that Article 40 (on the annual general meetings) of Chapter 4 (on the general assembly) of the SCA Board Chairman’s Decision No. (3/Chairman) of 2020 Approving the Public Joint-Stock Companies’ Governance Guide, particularly Clauses 1, 2, 3, and 4, include detailed rules on the shareholders’ agent.

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