Corporate Governance

, Chairman, Chairman, ChairmanNaseej views corporate governance as a prerequisite to complying with appropriate legal and regulatory requirements, protecting the rights and interests of all stakeholders, enhancing shareholder value, and achieving organisational efficiency.

Governance structure and organisation chart

The adoption and implementation of corporate governance is the direct responsibility of the Board of Directors. As resolved in its first meeting on 21 June 2009, the Board is committed to upholding the highest standards of excellence in corporate governance, and despite not being a listed company, aspires to adherence with the principles of the Bahrain Corporate Governance Code issued by the Ministry of Industry and Commerce in March 2010, in anticipation of a planned future listing on the Bahrain Bourse and subsequent IPO. The Company is currently undertaking an assessment of the regulations of the Bahrain Corporate Governance Code, and will develop an action plan for review by the Board in 2011.

Shareholders
Naseej has a total of 19 shareholders. Those owning more than a 5% shareholding are:
Ithmaar Bank (17.47%), BBK (15.15%), Gulf Finance House (13.94%), Ithmaar Development Company (11.99%), Social Insurance Organisation (10.91%), Al Fateh Investment (6.06%), and Imad Al Nesnas (6.06%)

Board of Directors
The Board of Directors of Naseej is accountable to the shareholders for the creation and delivery of strong sustainable financial performance and long-term shareholder value. The Board has oversight responsibility for strategic planning, risk management and internal controls, as well as for ensuring transparency and full disclosure, and acting in a Sharia-principled manner.

The Chairman is responsible for leading the Board, ensuring its effectiveness, monitoring the performance of the Executive Management, and maintaining a dialogue with the Company’s shareholders.

As per the Articles of Association, Naseej will have a minimum of five and a maximum of ten directors, who are elected by the Annual General Meeting for a tenure of three years renewable. 

Board Committees
The Board has delegated certain responsibilities to Board Committees without abdicating its responsibility. This is to ensure sound decision making and facilitate the conduct of business without unnecessary impediment. Each Committee has a specific charter covering matters such as the purpose, composition and function of the committee. The Board has appointed the following six committees to assist it in carrying out its responsibilities:

Projects and Investment Committee
The responsibility of this committee is to ensure that shareholders’ assets are invested appropriately within the risk appetite determined by the Board and Risk Committee.

Members:
Mr Mohammed Khalil Alsayed, Chairman
Mr Mohamed Bucheerei
Mr Abdulkarim Bucheery
Mr Khalid AlMannai

Audit Committee
The responsibility of this committee is to maintain and monitor an audit-based approach to all financial control and financial management activities of the Company.

Members:
Mr Bashar Al Mutawa, Chairman
Mr Hisham AlRayes

Risk Committee
The responsibility of this committee is to establish, maintain and monitor a risk-based approach to all business activities and management of the Company.

Members:
Mrs Sabah AlMuayyed, Chairman
Mr Khalid Abdulla Janahi
Mr Jameel AlMatrook

Remuneration, Nomination and Corporate Governance Committee
The responsibility of this committee is to establish and monitor the Company’s human resources, nomination and remuneration policies for Directors, management and staff.

Members:
Mr Abdulkareem Bucheery, Chairman
Mr Mohamed Khalil AlSayed
Mr Imad AlNesnas

Management
The Board delegates authority for the day-to-day management of the business to the Chief Executive Officer, who is supported by a qualified and experienced senior management team. 

Communications
Naseej conducts all communications with its stakeholders in a professional, honest, transparent and timely manner. Main communications channels include an AGM, annual report, corporate website, newsletter and regular announcements in the appropriate local media. To ensure the disclosure of relevant information to all shareholders on a timely basis, the Company maintains a website, on which it posts important information including its financial results.

Risk Management
Naseej has developed a risk management framework that provides controls and ongoing management of the major risks inherent in the Company’s business activities. The Board of Directors has the ultimate authority for setting the overall risk appetite, risk tolerance, parameters and limits, within which the Company operates. The Board Risk Committee is responsible for establishing, maintaining and monitoring a risk-based approach to all business activities and the management of the Company.

Main Risk Exposure
The main risks to which Naseej is exposed are: credit risk; market risk, including currency and profit rate risk; and liquidity risk. Information concerning the Company’s exposure to each of these risks, and how it measures and manages such risks, is contained in Note 14 to the Financial Statements.

Capital Management
The Board’s policy is to maintain a strong capital base in order to maintain investor, creditor and market confidence, and to sustain the future development of the company. The Board seeks to maintain a balance between the higher returns and growth that might be possible with higher levels of borrowings, and the advantages and security offered by a sound capital position.

Internal Audit
Internal Audit provides an additional line of defence in risk management and internal controls. The role of internal audit is to provide independent and objective assurance that the process for identifying, evaluating and managing significant risks faced by the Company is appropriately and effectively applied.

Internal Audit reports on a quarterly basis to the Board through the Audit Committee; reports the results of periodic audits to the Audit Committee; reports issues emerging from each audit to Management and obtains their commitment to take appropriate remedial action; and continually reviews the effectiveness of the Company’s risk profile.

Naseej currently outsources the internal audit function.