CORPORATE GOVERNANCE

OVERVIEW 

Corporate governance is defined as the frameworks used to direct and manage the business and affairs of the institution towards improving the quality of business and institutional responsibility, and focus mainly on achieving long-term interests of shareholders, taking into account the interests of other stakeholders.   According to the principles of the Economic Co-operation and Development Organization, the corporate governance means “a set of relations between the company’s management and its Board of Directors and its shareholders and other stakeholders in it. The corporate governance provides the structure through which the objectives of the company status as well as identifying the means to achieve those objectives and monitoring performance. It also must provide incentives for good corporate governance suitable for the Board of Directors and management of the same in order to pursue the goals that serve the interests of the company and its shareholders, as it should provide an effective means of control. The existence of an effective system of corporate governance within the company or group in the context of the economy as a whole helps to provide a degree of trust which is necessary for the conduct of an economy of a market correctly.”

OBJECTIVES

Corporate Governance guide mainly aims to ensure following the best practices of the company and the principles of corporate governance, according to the best standards and instructions based on the Capital Markets Authority. This guide lays the basic principles and limited standards which is the basis for the achievement of corporate governance within the Hayat Communications Company. The adoption of the standards and principles of corporate governance would confirm that Hayat Communications Company has the ability to balance the practice of risk activities properly and thereby to maximize the protection of the return to shareholders. Moreover, the company believes that the application of strong standards of governance that would protect the interests of all key 3 stakeholders. The company also believes that strong corporate governance principles would protect against all forms of mismanagement and fraud as well as activities to enhance accountability and transparency at the company.

SCOPE

The current directory is based on the status of each of the basic concepts of responsibility, accountability and transparency. It also applies to each of the executive management and the Board of Directors. Below are the elements/key principles that corporate governance are based upon in the State of Kuwait, in accordance with the legislative and regulatory frameworks, as well as international best practices:

• Kuwaiti Companies Law
• Laws regulating the Kuwait Stock Exchange (KSE)
• Regulations and decisions of the Capital Markets Authority (CMA) This guide should be reviewed along with the company’s statute and articles of association, in addition to the related regulations, instructions and circulars of corporate governance issued from time to time.

GOVERNANCE AT HAYAT COMMUNICATIONS COMPANY

Governance refers to the manner in which Hayat Communications Company is being managed or controls its management. The following are the main points covered by the corporate governance policy:

• Corporate governance must be transparent for all key stakeholders to ensure effective supervision of the company’s board and executive management and their accountability.
• The Board of Directors is always taking care of the interests of key stakeholders and its protection.
• The process of forming committees must be disclosed and its responsibilities must be controlled and subject to periodic reports.
• The functions and responsibilities of the executive management should be clearly disclosed. The CEO shall be administratively subordinate to the Board of Directors and be responsible for implementing the policies and directives of the Board of Directors.
• Hayat Communications Company is committed to announcing all the relevant financial results in addition to the financial situation, according to regulators in Kuwait. Also, it must adhere to International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS).
• Hayat Communications uses technology dramatically to enhance the transparency of operations, accountability and integrity of the data and make it available.

KEY PRINCIPLES OF CORPORATE GOVERNANCE

FIRST PRINCIPLE

Hayat Communications Company applies a comprehensive framework for corporate governance policy which is committed to policies and practices to the provisions of laws, regulations and instructions issued by the various regulatory bodies in order to protect shareholders’ rights on an equal footing.

SECOND PRINCIPLE

The existence of a mechanism within the company that will ensure improving the role of key stakeholders and through which the company can fulfill its corporate social responsibility.

THIRD PRINCIPLE

The existence of a clear disclosure system within the company to improve the principle of transparency.

FOURTH PRINCIPLE

Hayat Communications Company ensures that the disclosure of financial and non-financial information is done in accordance with the requirements of International Accounting Standards.

FIFTH PRINCIPLE

Hayat  Communications Company ensures the existence of the necessary systems and procedures and the enjoyment of its employees with the necessary knowledge and skills in order to comply with these principles and other criteria.