Saudi Corporate Governance Regulations

What are the Saudi Corporate Governance Regulations?

The Saudi Corporate Governance Regulations (CGR) are rules issued by the Capital Market Authority (CMA) of Saudi Arabia to enhance transparency, accountability, and shareholder rights in publicly listed companies. First introduced in 2006 and updated in 2017, these regulations establish a framework for how boards of directors, executive management, and shareholders interact to ensure sustainable growth and responsible business conduct.

The CGR apply to all listed companies on Tadawul (Saudi Stock Exchange) and set minimum requirements while encouraging firms to adopt higher governance standards.

Why the Saudi Corporate Governance Regulations Matter

  • Investor Confidence – Promotes fair treatment and transparency for all shareholders.

  • Board Effectiveness – Defines roles, responsibilities, and structures for directors.

  • Risk Management – Ensures companies adopt internal controls and compliance systems.

  • Sustainable Growth – Encourages ethical decision-making and long-term corporate strategy.

  • Global Alignment – Brings Saudi businesses closer to international governance best practices.

Key Provisions of the Saudi Corporate Governance Regulations

  1. Board Structure & Responsibilities

    • Separation of chairman and CEO roles

    • Independent directors requirement

    • Committees (audit, nomination, remuneration)

  2. Shareholder Rights

    • Fair voting rights and general assembly participation

    • Protection against conflicts of interest

    • Transparent dividend policies

  3. Disclosure & Transparency

    • Regular financial and non-financial reporting

    • Insider trading prohibitions

    • Disclosure of related-party transactions

  4. Risk & Internal Control

    • Requirement for internal audit functions

    • Risk management and compliance oversight

    • Annual board review of governance practices

Example in Practice

A listed company on Tadawul must establish an audit committee with independent members to oversee financial reporting and internal controls. This protects investors and aligns with CMA requirements.

How VComply Can Help

VComply supports Saudi companies in meeting Corporate Governance Regulation requirements by:

  • Automating board governance processes (agenda, minutes, voting records)

  • Centralizing compliance tracking for CMA regulations

  • Enabling policy management aligned with governance best practices

  • Supporting internal audit workflows and risk monitoring

  • Providing real-time dashboards for board and shareholder reporting

With VComply, listed companies in Saudi Arabia can simplify governance compliance, reduce regulatory risk, and build stronger stakeholder trust.