Although prior to the listing and the offering the business might have been managed by directors or managers, the scope and nature of duties and responsibilities as well as potential liability of the board of directors (“Board”) and its members post listing/offering will be much broader than before. 

For example, Board members may be required to carefully monitor and report their interest in the issuer, become responsible for numerous filings with the exchange and the regulatory authority and cannot be remunerated otherwise than in compliance with a prescribed process. This article examines the context of Saudi companies that have their shares listed and admitted to trading on the Saudi Stock Exchange (Tadawul) (“SSE”).

It further sets out some main considerations for Board members of Saudi companies whose shares are listed and admitted to trading on the SSE. 

LEGAL FRAMEWORK: 

Duties, responsibilities as well as certain restrictions concerning operations of the Board are prescribed under a number of sources: