CME-1 Corporate Governance

Question 1

What is the primary regulation governing corporate governance of listed companies in Saudi Arabia?

Accepted Answer

Corporate Governance Regulations issued by the CMA

Answer

Banking Control Law

Answer

Companies Law alone

Answer

Saudi Vision 2030 guidelines

Question 2

What is the minimum number of independent directors required on the board of a Saudi-listed company?

Accepted Answer

At least two independent directors or one-third of the board, whichever is greater

Answer

One independent director

Answer

Half the board must be independent

Answer

No minimum requirement

Question 3

Which committees are mandatory for Saudi-listed companies under CMA governance regulations?

Accepted Answer

Audit committee, remuneration committee, and nomination committee

Answer

Only the audit committee

Answer

Audit committee and remuneration committee

Answer

No committees are mandatory

Question 4

What is the role of the audit committee in a Saudi-listed company?

Accepted Answer

Overseeing financial reporting, internal controls, and the external audit process

Answer

Managing daily operations

Answer

Setting executive salaries

Answer

Approving new product launches

Question 5

Under Saudi corporate governance, what disclosure obligations apply to board members regarding conflicts of interest?

Accepted Answer

Board members must disclose any direct or indirect interest in transactions with the company

Answer

No disclosure is required

Answer

Disclosure is only required for amounts above SAR 1 million

Answer

Only the chairman must disclose conflicts

Question 6

What rights do minority shareholders have under Saudi corporate governance regulations?

Accepted Answer

Rights to cumulative voting, access to information, and bringing derivative actions

Answer

No special rights beyond voting

Answer

Only the right to attend annual meetings

Answer

Rights are limited to dividends only