SCA: 2011 Disclosure Rate of Listed PJSCs is 97.5%
WAM Abu Dhabi, 26th May 2012 (WAM) -- The Emirates Securities and Commodities Authority (SCA) has said that disclosure rate of listed local public joint stock companies (PJSCs) is 97.5%, according to the 2011 corporate governance report. It said 84 out of total PJSCs listed on the UAE markets are compelled to implement Ministerial Decree No. 518 of 2009 concerning Corporate Governance and Institutional Discipline Standards, adding that 80 of them had to issue corporate governance reports during the first half of 2012.
According to the SCA, 78 out of 80 companies have furnished the SCA with their 2011 corporate governance report, representing a compliance rate of 97.5%. The report excluded all banks and companies licensed by the UAE Central Bank as well as foreign companies from implementing the rules of the Decree.
It said 71 companies, representing 89%, provided the SCA with their full 2011 corporate governance report according to the approved format, while seven (7) others provided the SCA with their full 2011 report but with some observations on them for rectification.
Commenting on the report, Abdullah Al-Turifi, SCA Chief Executive Officer, said the SCA has made it a priority to apply the rules of good governance on all listed companies, being a strategic objective which it is striving to achieve in view of its deep belief in the significance of corporate governance rules in enhancing institutional discipline, transparency and good governance, which are very important to investors who now prefer to invest in companies applying strictly corporate governance rules.
Al-Turifi cited his outfit's efforts in urging listed companies to apply corporate governance rules since 2007, as well as its promotion, adoption and enforcement of corporate governance rules steadily until it became compulsory in May 2010.
He praised the companies for their high level of awareness and commitment as some of them took the initiative of adopting the rules voluntarily even before they became compulsory. He said although some companies are not covered by the compulsory demand to apply the rules of corporate governance, they have taken the steps to implement them because they put first the interest of the company, its shareholders and other interested parties.
The SCA, as the market regulator with oversight for ensuring the implementation of the corporate governance resolution by listed local PJSCs, has issued last year a circular to all concerned companies demanding from them to prepare and present 2011 corporate governance report according to SCA-approved format and to make the report available to all stakeholders long enough before the convening of the company's general assembly.
Since 2009, the SCA has been publishing on its website the corporate governance reports issued by listed local PJSCs concerned with the application of Decree No. 518 of 2009. The 2009, 2010 and 2011 reports are available on and accessible from the SCA website.
The SCA, early this year, started dispatching a team of experts to concerned companies to practically check their corporate governance application procedures and to ensure they adhere strictly to the rules as per the Ministerial Decree No. 518 of 2009.
The team checks a company's internal control system, the working mechanisms of its executives and committees and other issues related to corporate governance. The team also provides the necessary advice to the company on the right application of corporate governance rules and practices and follow-up to see changes that crop up in the company as a result of the latter's application of the rules.