Press release

On the Issuance of the Code of Corporate Governance

HE Sheikh Abdullah Salim Al Salmi, Executive President of the Capital Market Authority said the Board of Directors of the Capital Market Authority has approved in its last meeting on 9 July 2015 the new version of the Code of Corporate Governance which was  the harvest of efforts  in two years as a committee was established to develop the code comprising  members from all sectors in addition to professional to review the code  in line with the international standards and principles.

HE pointed out the approval of the code coincided with the issuance of the Royal Decree which established Oman Centre for Corporate Governance and Sustainability which in culmination of the considerable efforts exerted in the  past years. He expressed his confidence the Centre will promote the principles of corporate governance and sustainability and provide advice and technical support for corporates whether public, closed or family business on any aspect of governance, sustainability and transparency.

On the contents of the new code HE explained these are additional rules to improve the work to ensure accuracy and transparency, hence compliance with the code depend on contentment with the importance of such requirement so as to have transparency and governance and I hope every company or establishment would have its own code setting out the basis for transactions among the employees or with suppliers or the community as a whole. The main purpose of the code is to instill this culture in the business community in Oman and this is why it was named code not law.

HE added CMA used to present it  regulations for the public opinion for their remarks and views. The draft code was posted on CMA’s website and CMA received feedbacks that contributed to the new code.

HE the Executive President expressed his happiness and appreciation for the responses of the joint stock companies for the CMA’s requirements adding that the corporate governance is key in encountering the challenges to enhance their ability to withstand the competition. He added corporates have complied with the principles and standards of corporate governance since the financial crisis in 2008 and the policies, decisions and challenges they faced following the crisis which emphasized the importance of corporate governance in streamlining the conduct and practices of corporate  officers and executives at all levels in addition to strengthening the sense of responsibility and accountability.

He added CMA was keen to protect the rights of shareholders and investors,, therefore it continued its endeavors to consolidate the rules of corporate governance and dissemination of the corporate governance awareness on the institutional level at listed companies through training of directors and executives and other officers.

On the corporate governance arrangements and policies, HE the Executive President of CMA empathizes communication with corporates to promote risk management  operations and enhancing transparency pointing out that good management protects the rights of shareholders from risks and high costs of capital.

In reply to our question  on the reasons for issuing new code for corporate governance HE Abdullah Al Salmi said there was a need to amend the code of corporate governance to contribute to support the economic process in the country for sustainable economic performance due to the direct impact in attaining strong, transparent and competitive economy.

HE added that we live in a rapidly changing era which require continued review of our legislations and systems including the Code of Corporate Governance to improve the local practices according to bests international practices to  curb and violations and to positively reflect on the quality of management of public companies. HE said the code was guided by international codes and the recommendations of the OECD and IFC.

HE said the Code pertains to public listed companies and there is plans to set up a code for government companies and family companies, until then, they may adopt part or all the present code which is optional for better performance and motivation to adopt all the details of the code. HE added that the idea is for the professional business enterprises is to be convinced of the importance of  such requirements to expand the base of confidence and transparency.