July 21, 2016 Muscat -

Oman's new Code of Corporate Governance comes into effect today.

In a circular, H E Abdullah al Salmi, executive president of the CMA, said, "The CMA would like to bring to the attention of all public joint stock companies that the Code of Corporate Governance issued vide circular E/4/2015 dated July 22, 2015, will come into effect as from Thursday July 21, 2016 after the end of the grace period of one year for implementation."

The CMA board of directors had approved the new version of the code in July last year. The new code places emphasis on transparency, accountability, fairness and responsibility in the boards and managements of all listed companies.

The new code stipulates that all board members of listed companies shall be non-executive directors. The percentage of independent directors to the total number of board members shall not be less than one-third, with a minimum of two independent directors.

Moreover, directors who have been elected for the first time or re-elected must undergo some qualification in

corporate governance and sustainability through training programmes at the company's expense.

Other major changes include compulsory formation of a nomination and remuneration committee and emphasis on the competence and effectiveness of directors.

The new code states that the board shall establish a nomination and remuneration committee with the aim of assisting the general meeting in the nomination of proficient directors and the election of the most eligible. The company shall also develop a proper remuneration and incentives policy to attract competent executives with proper wages and remuneration.

The implementation of the new code coincides with the general meetings of listed companies which will witness the constitution of new boards and sub-committees.

© Muscat Daily 2016