Why Corporate Governance Matters for Every Business
Companies must set up strong corporate governance to protect their business. The board of directors should create and review a good governance framework. Companies face many accounting frauds, so each firm must build reliable internal controls to stay safe and meet regulatory demands.
In the UAE, new laws make good governance a requirement. The board should check internal controls often and update their framework to face new business challenges.
UAE Regulatory Needs for Corporate Governance
Companies in the UAE must follow clear governance rules. Authorities like the Central Bank and the Securities & Commodities Authority set standards for every company.
Some main regulations are:
- Central Bank’s Corporate Governance Standards (since July 2019)
- Securities & Commodities Authority Guide (Joint Stock Companies, 2020)
- Cabinet Governance System (Federal Boards, 2020)
Insurance companies and other special sectors must also follow extra rules from their regulators. Firms should know all the rules that apply in their sector.
Key Elements of a Good Corporate Governance Framework
Each company should focus on these major elements:
- Operating Model:
Board setup, committee roles, selection processes, and reporting lines. - Culture:
All employees should know about governance. Companies use training, intranet, and circulars. Staff must follow codes of conduct and use whistleblowing systems to report fraud. - Risk Management & Internal Controls:
Firms must build risk structures and follow the three lines of defense model. Regular audits and quality checks are needed. - Reporting Practices:
Companies should complete reports and disclosures on time. They must keep meeting minutes and follow up on action points.
These elements help businesses grow and build trust with investors.
Benefits of Effective Governance in a Business
A strong governance system gives many advantages:
- Companies earn the trust of investors, staff, and partners.
- The business can respond faster to new risks and changes.
- Firms stay compliant with UAE laws and meet stakeholder needs.
- Clear governance supports long-term business growth.
- Internal controls reduce the risk of fraud and errors.
Having a good framework boosts performance and keeps the business safe.
Major Challenges When Building a Governance Framework
Companies meet many roadblocks, including:
- Knowing how much governance is “enough” for their size and sector.
- Building a company culture that respects governance rules.
- Finding skilled staff and resources to support the governance framework.
- Running regular reviews and audits to test if controls are working.
Companies must deal with these issues as their business grows and laws change.
How Mubarak Al Ketbi (MAK) Auditing Supports Corporate Governance
Mubarak Al Ketbi (MAK) Auditing helps firms meet governance needs and use best industry practices in the UAE.
We provide:
- Advisory and consulting on all governance requirements
- Review of your company’s current framework and controls
- Expert insights for implementing best practices
- Assessment tools for testing framework effectiveness
- Guidance to avoid common audit and control mistakes
Mubarak Al Ketbi (MAK) Auditing uses deep local knowledge and global standards to serve all clients.
How Mubarak Al Ketbi (MAK) Auditing Can Help You
If you want your company to run like a well-oiled machine, you should trust Mubarak Al Ketbi (MAK) Auditing for your governance needs. Our team helps every business set up solid frameworks and improve their internal controls.
- Advisory for building governance and controls
- Review and testing of your framework
- Guidance for training staff and shaping company culture
- Compliance checks for all UAE regulations
- One-hour free consultation for new clients
For more information:
- Visit our office: Saraya Avenue Building – Office M-06, Block/A, Al Garhoud – Dubai – United Arab Emirates
- Contact/WhatsApp: +971 50 276 2132
