The corporate governance is the set of processes, customs, policies, laws, and institutions affecting the way a corporation (or company) is directed, to protect the rights of shareholders, stakeholders and employees through contractual relationships ,and sound financial and accounting instruments, pursuant to the disclosure and transparency principles. The Capital Market Authority in the Kingdom has issued the corporate governance regulations for solicitation of the opinion of the concerned parties.
TASNEE Board approved the corporate governance guide which the company observes its items and adheres thereto. It also applies most of the rules contained in
the corporate governance regulation issued by the Capital Market Authority in KSA and is completing setting a number of polices and procedures in form of regulations.
Rules of the corporate governance regulations that are not applicable in the company are detailed as follows:
| 6/b |
Accumulative voting for electing the Board members |
Voting for election of members of the Board according to the Company shall be made pursuant to traditional method consistent with the corporate system. |
| 6/d |
Reviewing annual rerports for investors having judicial eports capacity such as investment funds in order to be acquainted with their policies. |
Difficulty of application due to its connection with other persons' policies which were not stated publicly. |
| 10/z |
Setting written policies that organize relation with stakeholders for protecting them and their rights. |
Contracts guarantee that, and there was not need for the Company to set written policies for that. |
| 12/d |
Commitment not to combine between the post of the Board Chairman and any executive post. |
The company's present need requires benefiting from capabilities of the Board's Chairman in its executive tasks. |
| 12/p |
Commitment of the person, having judicial capacity with the right according to the company Articles-to nominate his representatives in the Board, not to vote on election of other members. |
This provision is not applicable to the company because there is not a provision in the Articles giving the judicial bodies the right to nominate their representatives in the Board. |
| 14/8 |
Revision committee to perform a stud of the initial annual financial statements before being forwarded to the Board. |
This rule has been applied relating to auditing annual financial statements; but as to initial or quarterly financial statements, the multiple of the affiliates and the short duration available make it difficult for the review committee to accomplish that within regular durations. |
| 15/c/3 |
The nominations and awards committee to review the structure of the Board and forward recommendations regarding changes that can be made. |
The committee is newly formed and it did not see it necessary to perform changes in the Board structure. |
| 15/c/3 |
The nominations and awards committee to define the weakness and strength points in the Board and to propose remedy. |
The committee was formed after the start of the present Board session, and it will discuss this matter before elections of nomination for next session. |