Corporate Governance is the set of processes, customs, policies, procedures, laws, internal controls, communication systems and reporting systems affecting the way a company is directed, administered or controlled.
Corporate Governance also includes the relationships among the many stakeholders involved and the goals for which the company is governed. The principal stakeholders are the shareholders, the board of directors, employees, regulators, customers, creditors, suppliers, business partners, the industry, and the community at large.”
Corporate governance “refers to the system whereby shareholders, creditors and other stakeholders of Buruj ensure that management enhances the value of Buruj as it competes in an increasingly global market place”. It encompasses the entirety of the legal and factual regulatory framework for managing and supervising the company. The primary goal of corporate governance is to create and sustain increased value in Buruj for all of its stakeholders. To achieve this goal, it is necessary, among other things, to clearly set forth the principles of appropriate supervision and good management, and thereby lay the groundwork for development and implementation of value-creating activities.
Moreover, it is as important that these agreed principles of governance are made transparent to all stakeholders concerned, thereby safeguarding stakeholders’ rights as well as promoting stakeholder participation in the corporate governance process.
The framework for corporate governance is not drawn from any single document. The corporate governance regulations in the Kingdom of Saudi Arabia issued by the Capital Market Authority (CMA) lay down the basic legal framework for corporate governance of every public corporation. It is supplemented by the Saudi Arabian Monetary Agency (SAMA), along with other applicable laws and regulation in the Kingdom of Saudi Arabia.
The machinery for corporate governance of Buruj cooperative insurance company is principally contained in the articles of association. These constitutive documents lay down, among others, the basic structure of governance, and the principal duties of the Board of Directors and officers of the company. The function of the Corporate Governance manual is to supplement and complement the company’s articles of association by setting forth principles of good and transparent governance.
The board of directors, committees, management, officers and employees of Buruj commit themselves to the principles and best practices of governance contained in the Corporate Governance manual as a guide in the attainment of its corporate goals. The company makes a continuing effort to create awareness of good corporate governance within the organization. At the same time, the entire organization declares its continuing commitment to the mission statement and vision of Buruj cooperative insurance company made an integral part of this manual.
Corporate governance at Buruj is designed to:
Enhance corporate performance.
- Instill investors’ confidence in the Company.
- Strengthen shareholder and community confidence in the Company
- Enhance public reputation through increased transparency and accountability.
- Permit entities to demonstrate the effective discharge of legal, shareholders and ethical obligations.
- Provide a mechanism for benchmarking of accountability.
- Assist in detection and prevention of fraud, dishonesty or unethical behavior.