Joint Stock Companies Governance Guide

Approves the governance guide for joint stock companies: board composition and duties, conflicts of interest, general assemblies, shareholder and stakeholder rights, board committees, risk management, compliance and external audit, governance disclosure, and general assembly organisers.

Summary

Decision No. 3/Chairman of 2020 approves the Corporate Governance Guide for public joint stock companies (PJSCs), the code that sets how the boards of UAE listed companies are composed, how they deal with conflicts and related parties, how general assemblies run and what must be disclosed. It was issued on 2 February 2020, applied 60 days after publication, and cancelled the 2016 institutional discipline standards (Decision No. 7/Chairman of 2016) (Articles 2 and 3 of the decision). The guide has been amended several times, most extensively by Decision No. 2/Chairman of 2024 (in force 16 January 2024) and most recently by Decision No. 24/Chairman of 2025, in force 30 August 2025, which allowed the chairman and company manager roles to be combined under strict conditions. It now refers to the Commercial Companies Law, Federal Decree-Law No. 32 of 2021.

Under Article 3 of the guide it applies to local PJSCs listed on a UAE market; it does not apply to listed foreign companies, financial free zone companies or free zone companies. Directors are elected by secret cumulative voting, and the chairman and a majority of the board must be UAE nationals (Article 6). At least one third of directors must be independent, the majority non-executive, and at least one woman must sit on the board (Article 9). Nominations stay open for at least ten days. The chairman may not hold an executive post except as company manager where the articles allow it, three quarters of the board and all permanent committees are independent, and the general assembly approves it by special resolution (Articles 7 and 7 bis). Board remuneration is capped at 10% of net profit after depreciation and reserves, with a fixed fee of up to AED 200,000 where there is no or little profit (Article 29). Records are kept for at least ten years (Article 4).

Article 34 bars related-party transactions above 5% of capital without board approval and, beyond that, general assembly approval, with valuation by a CMA-accredited assessor; the related party may not vote, and directors who approved an unfair transaction are liable. Shareholders holding 5% may sue to annul such transactions. The guide also requires an insider register, an audit committee with financial expertise, other board committees, risk management, internal control and compliance functions, and an annual governance report. Appendix 1 regulates CMA-approved organisers of general assemblies.

Who it applies to

Local public joint stock companies listed on a UAE securities market, their boards, directors, board secretaries, executive management, committees, auditors and related parties, and CMA-approved organisers of general assemblies. Listed foreign companies, financial free zone companies and free zone companies are outside its scope.

Contents

English official text in 82 articles. Open the full text or jump to a provision:

1. Article 1 — Guide Approval
2. Article 2 — Cancelation of Conflicting Provisions
3. Article 3 — Decision Publication and Application
4. Article 4 — Responsibility for Implementing the Corporate
5. Article 5
6. Article 6 — Board Formation
7. Article 7 — Board Chairman
8. Article 8 — Board Secretary
9. Article 9 — Controls of Nomination for Board Membership [17]
10. Article 10 — Terms of Nomination for Board Membership
11. Article 11 — Declaration of Interest
12. Article 12 — Induction, Training and Board Evaluation
13. Article 13 — Board Responsibilities
14. Article 14 — Board Obligations
15. Article 15 — Duties of the Board Chairman
16. Article 16 — Obligations of the Board Member
17. Article 17 — Non- Executive Board Member Obligations
18. Article 18 — Convenience Standards
19. Article 19 — Lack of Board Member Independence [44]
20. Article 20 — Sole Liability of Board Members [46]
21. Article 21 — Board Member Position Vacancy
22. Article 22
23. Article 23 — Board Meeting
24. Article 24 — Holding Board Meeting Via Modern Technology
25. Article 25 — Board Decisions by Passing
26. Article 26 — Minutes of the Board Meetings
27. Article 27 — Delegation of Administration
28. Article 28 — Seeking Advice from an External Advisory
29. Article 29 — Remuneration of the Board Chairman and Members
30. Article 30 — Gifts [59]
31. Article 31 — Confidentiality of Data and Information
32. Article 32
33. Article 33 — Insiders Register
34. Article 34 — Transactions with Related Parties
35. Article 35 — Transactions fall under Company Business Nature
36. Article 36 — Related Parties Record
37. Article 37 — Company Disclosure of related Parties’ Transactions
38. Article 38 — Related Party Disclosure
39. Article 39 — Access to Transactions Concluded with related
40. Article 40 — General Assembly Meetings
41. Article 41 — The Invitation to the General Assembly Meeting
42. Article 42 — Record of General Assembly Meetings Minutes
43. Article 43
44. Article 44 — General Assembly Meeting Arrangements
45. Article 45 — Listing an Item in the General Assembly Agenda [74]
46. Article 46 — Issuance of a Special Resolution
47. Article 47 — Implementation of the Resolutions of the General
48. Article 48
49. Article 49 — The Required Controls to Ensure Shareholders’
50. Article 50 — Distribution of Profits
51. Article 51 — Investor Relations
52. Article 52 — Stakeholders’ relationships management
53. Article 53
54. Article 54 — Dual Governance Structure
55. Article 55 — Control committee
56. Article 56 — Executive committee
57. Article 57
58. Article 58 — Permanent Committees
59. Article 59 — Nomination and Reward Committee
60. Article 60 — Audit Committee
61. Article 61 — Duties of the Audit Committee
62. Article 62 — Audit Committee Meetings
63. Article 63 — Risk Committee
64. Article 64 — Technology Committee
65. Article 65 — General provisions for Committee Meetings
66. Article 66 — Risk Management and Internal Auditing
67. Article 67 — Risk Management
68. Article 68 — Internal Auditing
69. Article 69 — Compliance Officer
70. Article 70 — Auditor Selection
71. Article 71 — Auditor Duties
72. Article 72 — Prohibitions of Auditors
73. Article 73 — Consultancies and Works authorized to the Auditor
74. Article 74 — Information Disclosure and Transparency
75. Article 75 — Board Disclosure
76. Article 76 — Disclosure of Integrated Report
77. Article 77 — Corporate Governance Information
78. Article 78 — Provision of Additional Information and Data
79. Article 79 — Subsidiary Governance
80. Article 80 — Company Capital Increase
81. Article 81 — Corporate Social Responsibility
82. Article 82 — Breach of Guide Provisions

Key provisions

Obligations and deadlines

• Keep minutes, board and committee papers and general assembly records for at least ten years (Article 4).
• Ensure at least one woman, one third independent members and a non-executive majority on the board (Article 9).
• Obtain board and, above 5% of capital, general assembly approval for related-party transactions (Article 34).
• Notify the CMA and the market of the insider list at the start of each financial year and of changes (Article 33).
• Pay cash dividends within thirty days of the decision approving them (Article 50).
• Publish an annual governance report disclosing board composition, including women's representation (Article 9).

Penalties

Article 82 lets the CMA warn the company, its directors, managers or auditors, impose a fine up to the maximum set in the Commercial Companies Law, or refer the breach to the public prosecution. Under Article 34 the related party and the directors who approved a related-party transaction in breach of the rules, or one that is unfair, are liable to the company for damages, and Article 29 deducts CMA fines caused by board violations from directors' remuneration unless the general assembly decides otherwise.

History and citations

“Cites” and “Cited by” are built automatically from references in the full texts held in this library; they cover only instruments in the library.

Related instruments

Related Polaris services

• Corporate Secretary Services
• Corporate Structuring & Group Design
• Mainland Company Formation UAE