Unpacking corporate governance in Saudi Arabia: Strengthening shareholder rights and management responsibilities

Saudi Arabia has made significant advancements in corporate governance, aligning with global best practices to enhance shareholder protection, management accountability, and corporate sustainability. As the Kingdom continues its economic diversification efforts, regulatory frameworks have been strengthened to attract foreign investment and support long-term business success.

Key aspects of corporate governance in KSA:

• Legal framework – The Companies Law and Corporate Governance Regulations serve as the foundation for corporate governance, outlining shareholder rights, board responsibilities, and disclosure requirements.
• Board and management roles – Joint stock companies require a structured Board of Directors, while limited liability companies offer more flexible management options. The law defines key leadership responsibilities, ensuring clarity in governance.
• Shareholder rights & protections – Shareholders are guaranteed fundamental rights, including voting, profit-sharing, and access to company books and records. Provisions ensure equitable treatment, minority shareholder protections, and legal recourse against violations.
• Transparency & accountability – Directors and executives must adhere to high standards of care and loyalty, avoiding conflicts of interest and ensuring fair business practices. Compliance with disclosure regulations fosters investor confidence. These reforms reinforce Saudi Arabia’s commitment to fostering a fair, transparent, and sustainable corporate environment in alignment with Vision 2030.

Hourani & Partners is proud to have contributed to this feature, offering legal insights on the evolving corporate governance landscape in Saudi Arabia.

Read the full article on The Oath’s website here.