The Saudi Arabian Capital Market Authority (CMA) has earlier this year required increased compliance with the corporate governance regulations (Corporate Governance Regulations) dated 12 November 2006 G. (Corresponding to 21/10/1427 Hijri). The Corporate Governance Regulations generally apply to joint-stock companies listed on the Saudi Arabian capital market (Tadawul).

The rules of the Corporate Governance Regulations were initially not mandatory, and adopted the principle of comply-or-explain. However, effective January 2009, listed companies were required by the CMA to comply with certain rules of the Corporate Governance Regulations for the purpose of enhancing transparency and protecting shareholders’ rights.