Corporate Governance Of Listed Companies In Kuwait A Comparative Study With United Kingdom Saudi And Qatar Codes Link

: While Kuwait has introduced modern voting technologies and shareholder-initiated removal provisions, the UK's legal framework for shareholder protection (including derivative actions) remains more extensive. Saudi Arabia's proposed shareholder-initiated removal of board members represents an important development, and Qatar's new code places strong emphasis on shareholders' rights and equality.

: The code explicitly integrates the "three pillars of sustainable development"—economic, social, and environmental—positioning governance as a driver for ESG initiatives Comparative Analysis: UK, Saudi Arabia, and Qatar

Corporate governance dictates how companies are directed and controlled. It balances the interests of shareholders, management, customers, suppliers, financiers, government, and the community. For listed companies in Kuwait, robust governance ensures market integrity and attracts foreign direct investment (FDI).

While utilizing "comply-or-explain" terminology, regional regulators lean toward strict enforcement. In Kuwait, the CMA regularly issues financial penalties for governance deviations. This minimizes flexibility but accelerates compliance in developing markets. Related Party Transactions (RPTs) : While Kuwait has introduced modern voting technologies

The UK Code has rigorous requirements regarding executive pay and shareholder votes on remuneration policies, which are evolving in Kuwait but remain less prescriptive. Regional Benchmarking: Kuwait vs. Saudi Arabia and Qatar

Kuwait lags in "Equitable Treatment" due to the prevalence of cumulative voting rules that still favor large families, and "Stakeholder Role" because employee board representation is not mandatory (unlike Germany, but also uncommon in GCC).

Kuwait's corporate governance framework has matured significantly over the past decade. By mandating specialized committees, demanding independent oversight, and enforcing rigorous IFRS compliance, the CMA has successfully cultivated a more transparent and resilient investment climate. In Kuwait, the CMA regularly issues financial penalties

Kuwait requires companies to establish a risk management committee responsible for identifying, assessing, and mitigating enterprise risks, as well as internal audit and compliance functions. The UK Code's Provision 29 (effective 2026) takes this further, requiring boards to actively monitor and review the effectiveness of the framework and include a declaration of effectiveness in the annual report. Saudi Arabia's 2024 amendments made internal audit units, plans, and reports mandatory for listed companies. Qatar's new code includes internal control systems among its key topics.

UK Corporate Governance Code 2024 - Financial Reporting Council

The UK demands a significantly higher proportion of independent directors (50%) compared to the standard GCC benchmark (33%). 5 of 2025

Unlike the UK’s flexibility, Gulf codes—including Kuwait—adopt a hardline separation. This is logical given the family dominance; allowing a CEO to be Chairman in Kuwait would entrench controlling family power without minority review.

Qatar has recently taken a significant step forward with the issuance of the Governance Code for Listed Companies under QFMA Board Decision No. 5 of 2025, published in the Official Gazette on 17 August 2025 and effective immediately. The new code replaces the previous framework issued in 2016 and applies to both Main Market and Venture Market companies.