H.E. Dr. Obaid Al Zaabi
Governance regulations were drafted in accordance with IOSCO’s and OECD’s standards, the World Bank’s Doing Business report, and the World Economic Forum’s Global Competitiveness report
H.E. Dr. Obaid Al Zaabi, Acting Chief Executive Officer of the Securities and Commodities Authority (SCA), stressed the role SCA has in offering support and encouragement to companies at all levels and in providing innovative solutions to improve corporate fiscal performance and promote corporate values to benefit shareholders and the national economy. Dr. Al Zaabi applauded the efforts of the RAK Chamber of Commerce and Industry to promote the culture of corporate governance, identify corporate governance concepts, and spread awareness of corporate governance at listed companies.
Development of Governance Regulations
In his speech at the seminar, held by the RAK Chamber and titled “Promoting the Culture of Governance”, Dr. Al Zaabi reviewed the development of governance regulations in the country, indicating that the regulations, issued in 2007, were drafted in accordance with the best international practices in this regard.
SCA later issued a decision to allow listed companies an optional period for implementation that expires by the end of April 2010 followed by Cabinet Resolution No. (518) of 2009 on Governance Rules and Corporate Discipline Standards, issued by H.E. Sultan bin Saeed Al Mansoori, Minister of Economy and Board Chairman of SCA.
General Framework for Corporate Governance
Dr. Al Zaabi reviewed the general framework for corporate governance, including:
· Importance of corporate governance rules.
· Corporate governance concepts and objectives.
· Corporate governance related parties (i.e. stakeholders).
· Principles of the Organization for Economic Co-operation and Development (OECD).
· Comparison between the governance principles of the GCC states and those of the OECD.
· Stages of development of corporate governance in the UAE.
· Most important governance rules issued by SCA.
· Most important amendments contained in Cabinet Resolution No. (518) of 2009 on Governance Rules and Corporate Discipline Standards and its amendments of 2014 and 2015, as well as the new Companies Law No. (2) of 2015 and the articles of investor protection index as an indicator of global competitiveness.
Outcomes of Governance Rules Implementation
Dr. Al Zaabi indicated that the most notable outcomes of governance rules implementation since the issuance of Cabinet Resolution No. (518) of 2009, which was drafted in accordance with the principles of the International Organization of Securities Commissions (IOSCO) and those of the OCED, the World Bank’s Doing Business report, and the World Economic Forum’s Global Competitiveness report, include:
· An unprecedented development in disclosure by public joint-stock companies in 2015, amounting to 98%.
· SCA made a distinct success, which helped to support the country’s status on global competitiveness and enhance its capabilities in investor protection.
· Being ranked first globally for effective corporate boards, according to the annual World Competitiveness Yearbook published by the Swiss-based International Institute for Management Development (IMD) at the end of May 2014.
· Being ranked first among Arab and Middle Eastern and North African countries for investor protection. The country also leapt 59 ranks globally to make the list of the ten most improved economies (according to the World Bank’s Doing Business report).
· In 2015, the country leapt 15 ranks on the minority investor protection index (according to the World Bank’s Doing Business report).
Dr. Al Zaabi reviewed a number of other initiatives in corporate governance launched in the UAE, including:
· The Abu Dhabi Center for Corporate Governance (ADCCG), which was established by the Abu Dhabi Chamber of Commerce and Industry (ADCCI) in 2009.
· A business ethics center, founded in 2004 by the Dubai Chamber of Commerce and Industry to support and promote the concepts and practices of corporate social responsibility, sustainability, and good corporate governance.
· Hawkamah, an Institute for Corporate Governance, which was established by the Dubai International Financial Center (DIFC) in 2006.
· Corporate Governance Code for Small and Medium Enterprises (SMEs), which was created in 2011 by the Sheikh Mohammed bin Rashid Establishment for Small and Medium Enterprises Development.
Dr. Al Zaabi noted that SCA has succeeded in making these rules an established culture at public joint-stock companies listed on UAE financial markets.
It is worth noting that the opening speech was delivered by H.E. Mohammed Al Sabab, Acting Director of RAK Chamber. Dr. Ashraf Gamal El Din, CEO of Hawkamah, also delivered his speech, along with a number of specialists and experts in law and finance.