50 Corporate Governance Charter
P olicies, standards and procedures for nomination and appointment of the Board of Directors of Takween
First: General Introduction:
The policy, standards, and procedures for membership in the Board of directors of Takween – Public Joint Stock Company- has been prepared according to the requirements of Paragraph (3) under Article (22) of the Companies Corporate Governance Regulation issued by the Capital Market Authority (CMA) pursuant to the Board of CMA No (8-16-2017) dated on 16/05/1438H (Corresponding to 13/02/2017G) amended by the resolution of CMA Board No (3/57/2019) dated on 15/09/1440G (Corresponding to 20/05/2019G).
Which states that: “the Board of Directors shall set forth specific and explicit policies, standards and pro-cedures for membership in the Board, without prejudice to the mandatory provisions of this Charter and the Corporate Governance Regulation issued by CMA, and implementing them following approval by the General Assembly;
The Nomination and Remuneration Committee shall, in accordance with the competences and respon-sibilities of the Committee under Article (5) of this Chapter, submit its recommendation to the Board of Directors on the nomination announcement date, and the election dates for the new session, determines the start and end of the session to cover the responsibility of each Board member for the financial state-ments and reports for the fiscal year without two Board overlapping in one session in accordance with this Governance Charter approved by the General Assembly.
1. Board Member Nomination:
(a) Each shareholder shall be entitled to nominate him /herself or one or more other persons for board membership, based on his share in the capital.
(b) The Company shall publish the nomination announcement on the websites of the Exchange and in a daily newspaper according to the nomination date specified by the Nomination and Remuneration Committee; to invite persons wishing to be nominated to the membership of the Board.
(c) The nomination period shall remain open for at least (30) days from the date of the announcement.
However, such period may be for more than (30) days as the Nomination and Remuneration Com- mittee determined. Provided that nomination applications are received by the nominees themselves for membership during the period indicated in the nomination announcement. Any applications that received after the deadline will not be accepted.
(d) A Nominee for the Board membership shall send her/his application through one of the following methods:
1. The Company’s head office registered address or the Company’s national address.
2. Direct delivery to the Company’s management and then request a letter of receipt.
3. All applications shall be sent to Nomination and remuneration (e) The nomination application shall include in writing the following:
1. The nominee’s full name, and date of birth.
2. The nominee’s academic certificate and the dates on which he/she has obtained each certificate along with name of the educational body granted it.
3. The nominee’s professional experience, including the positions were held during the past ten years.
4. A list of the companies the nominee belongs or has interest in.
5. A list of the Relatives to the nominee of the Board membership.
6. A nominee shall fill our and sign the disclosure form issued by CMA on its website. Further, a nominee shall clarify the membership description.
51
Corporate Governance Charter
7. The Nomination and Remuneration Committee shall review all the nomination applications and deter- mine the qualified nominees and include them in a nominees list; and shall notify CMA by the form designed for such notification on CMA website. Then, an announcement shall be made on Tadawul website which shall include the number and names of the qualified nominees.
2. Standards for the Board Membership:
(a) A member of the Board is required to be professionally capable and has the required experience, knowledge, skill and independence, which enable him/her to perform his/her duties efficiently.
(b) He/she shall enjoy leadership skills which enable him/her to delegate powers in order to enhance per- formance and apply best practices in effective management and compliance with professional ethics and values.
(c) He/she shall have the ability to read and understand financial statements and reports.
(d) He/she shall enjoy sufficient knowledge in finance and administrative matters. Further, he/she shall be familiar with the rules, regulations and relevant legislation, in particular issued by the CMA and the rights and duties of the board of directors.
(e) allocating sufficient time for the Company’s activities required by the Board membership.
(f) The Company shall notify CMA of the names of the Board members and description of their member- ships within five business days from the commencement date of the Board term or from the date of their appointment, whichever is shorter, as well as any changes that may affect their membership within five business days from the occurrence of such changes.
(g) A Board member shall not be a member of the Boards of Directors of more than five listed joint stock companies at the same time.
(h) Any nominee who is a previous board member of a shareholding company shall state the number and date of the boards of the companies in which he was a member.
(i) Any nominee who is a previous company board member shall enclose with the nomination notice a statement from the company administration on the last session in which he was a board member in- cluding the flowing information:
1. The number of the board meetings held in each year of the session years, and the number of the meet- ings which the member attended personally and the percentage of his attendance in all meetings.
2. The standing committees in which the member participated, the number of the meetings held by each committee within one year of the session period, the number of the meetings he attended and the percentage of his attendance to the total meetings.
(k) He/she shall be fully and legitimately capacity.
(l) The nominee who will represent the private sector shall not be a government employee.
(m) The nominee shall have sufficient, appropriate practical and scientific experience that would contrib- ute to supporting the company’s journey on optimal performance and achieving its strategy.
(n) A nominee who has been dismissed from such a position in another company because convicted of dishonesty crime shall not be prohibited from nomination of the board.
(o) Anyone who is interested in being nominated to the company Board shall declare his/her wish by noti- fying the company administration in accordance with the specified period in the nomination announce- ment. Such notice shall include an introduction of the nominee with respect to his/her curriculum vitae, his/her qualifications and his/her work experience.
(p) A nominee who has been a board member in any other listed Company specially which have similar activities to Takween shall have a preference on the other nominees.
(q) the nominee shall not be previously convicted of dishonor or dishonesty crime.
52 52
(r) The nominee whose suspension has previously been issued for trading or working in the listed joint stock companies, except in the case of the validity of the suspension decision by the General Sec- retariat of Committees for Resolution of Securities Disputes or the Capital Market Authority. However, and upon the termination of the suspension decision, he/she shall have the right to be a nominee to the Board membership.
(s) Providing shareholders with adequate information on the nominee’s qualifications and relationships with the Company prior to voting, applying the cumulative voting method when voting in the general assembly for appointing Board member
(t) The number of Board nominees presented to the general assembly for voting shall exceed the number of available seats in order - to provide the general assembly the opportunity to select among several nominees, The Board can engage the services of an independent specialized external party to identify additional nominees for Board membership when the number of Board nominees is insufficient Third: Announcement of Nomination and Right of a Shareholder to Be a Nominee:
1. The nomination announcement shall be published on the websites of the Company and the Exchange and through any other medium specified by the Authority; to invite persons wishing to be nominated to the membership of the Board, provided that the nomination period shall remain open for at least a month from the date of the announcement.
2. None of the provisions of this Chapter shall prejudice the right of any shareholder to nominate him/
herself or others to the membership of the Board in accordance with the provisions of the Companies Law and Its Implementing Regulations.
