Policies and Procedures Manuals

Policies and procedures manuals are a means of internal control, which achieve efficiency and effectiveness in managing the organizational units. Policies and procedures manuals represent the flow of policies and resolutions approved by the Board of Directors and the executive management to all organizational units in clear and documented manner to ensure that the same are properly implemented. Further, documented and approved policies and procedures manuals ensure that the processes are recurrently implemented based on standard approach and quality of deliverables is attained on timely basis. This will help all organizational units to operate consistently and achieve their objectives in accordance with the approved strategic and operational plans, and ultimately put the business entity on the path to success.

Organizational Structure

An organizational structure is a system that outlines how certain activities are directed in order to achieve the goals of an organization. These activities can include rules, roles, and responsibilities.

The organizational structure also determines how information flows between levels within the company. For example, in a centralized structure, decisions flow from the top down, while in a decentralized structure, decision-making power is distributed among various levels of the organization.

Having an organizational structure in place allows companies to remain efficient and focused.

Delegation of Authority Matrix

The documentation of the Delegation of Authority Matrix is a key requirement of the internal control in business entities as it defines the financial and administrative responsibilities and authorities delegated to the incumbents in charge of approving the decisions and transactions within business entities. This will enhance the control and governance of work flow of official transactions in the business entities and prevent fraud and deceit. This concept applies to all business entities on optional basis.

For companies regulated by Capital Markets Authority (CMA) in the State of Kuwait, they should comply with the requirements of the Executive Regulations of Law No. 7 of 2010 comprising sixteen modules where Module 15 – Corporate Governance – contains controls for the requirement to observe the “Four Eyes Principles” when delegating the financial and administrative authorities in order to achieve the internal control.

Corporate Governance Reporting

The listed companies and licensed persons regulated by the State of Kuwait Capital Markets Authority (CMA) are required to submit periodic reports on the applications of corporate governance. It is worth mentioning that the corporate governance applications in the above entities are mandatory in accordance with Law No. 7 of 2010 and its Executive Regulations where such reports are submitted online via CMA portal. The said companies should provide CMA on annual basis with reports indicating the implementation of the requirements stated in the Corporate Governance Rules issued by CMA within maximum ten business days from 30 June of every year.

Furthermore, the board of directors of the above-mentioned companies should provide report on corporate governance in the agenda of shareholders’ general meeting and the company’s annual report.

Job Structure

Job structure constitutes the governing framework of the number and levels of jobs required in a single organizational unit. This recurrently applies to each organizational unit in order to ultimately achieve an overall balanced job structure in terms of target number of job incumbents and size of processes to be performed by them. This concept is applicable to all business entities.

Companies regulated by Capital Markets Authority in the State of Kuwait should comply with the requirements of the Executive Regulations of Law No. 7 of 2010, which comprise sixteen modules. Module 15 sets forth the requirement to define the roles, responsibilities and duties of the members of Board of Directors and the executive management as well as powers and authorities delegated to the executive management.