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29 March 2024

Mohammed issues decree on govt boards

Published
By Wam

His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, has issued a decree on the governance of Boards of Directors of the profit and non-profit institutions and corporate owned by the Federal Government, whether they currently exist or will be established in future. 

The move aims to strengthen the practice of transparency and set a benchmark standard of governance in the agencies owned by the federal government, starting from the top of the administrative hierarchy. 

The decree follows the Federal Law No. 5 for the year 2011, issued by President His Highness Sheikh Khalifa bin Zayed Al Nahyan, on regulating the Boards of Directors, Trustees and Committees of the federal government, under which the Council of Ministers will take responsibility for the formation and organisation of the Boards of Directors, Trustees and Committees in all ministries, federal institutions and bodies.

The Cabinet will determine the jurisdiction and control over their work, and determine or cancel the financial rewards. It can transfer the jurisdiction in cases it deems appropriate.

The resolution includes articles concerning the composition of Boards of Directors, the mechanism for selection of its members by the Council of Ministers upon experience and diverse skills. Under the decree, the Board of Directors will be the supreme authority of the federal institution and responsible before the Council of Ministers, on accomplishment of the objectives and implementation of policies, for which the institution was created, through the exercise of power and authority necessary to achieve its purposes.

The decree prohibits for a board member to be a member in more than four boards and not to serve as president in more than three federal institutions at the same time.

It is not permissible according to the resolution that the members of the boards of nonprofit federal institutions, who regulate or oversee companies with shares listed on the stock markets in the country, to be members of the boards of these listed companies. 

The resolution obliges the boards of profit and nonprofit federal institutions to form an Audit Committee to monitor risks and safety of the financial statements of the institution, in addition to evaluation of risk management policies, internal control and effective Internal Audit Department and cooperate with the Audit Bureau in accordance with the rules and accounting principles in practice. 

The resolution chalks out the principles and rules of professional conduct and ethics of public office to be adopted by the federal institutions, especially by the board.

The members of the board and executive management in profitable federal institutions that regulate or oversee the companies listed on stock markets in the government sector, should disclose on an annual basis their shares, while the board members and executive management in the non-profit federal institutions, should comply with the resolutions issued by the Securities and Commodities Authority, regarding trading, clearing and settlement, transfer of ownership and custody of securities.

According to the resolution, the Federal Authority for Government Human Resources, will prepare a special system on disclosure of all matters relating to the establishment of the institution, including the Federal financial position, performance, ownership and governance style of the institution, and submit it to the Council of Ministers.

The authority will develop a system to avoid conflict of interests in the federal institutions, which must be observed by the members of the board, executives and employees of the federal institution. 

The board must submit an annual report within a period not exceeding three months from the end of each calendar year to the Council of Ministers, including the name of President and Vice President, board members and members of committees, and the number of meetings and the copies of minutes of these meetings, summary on the activities of the board, committees and the results of evaluating the performance of committees, and a summary on the annual financial and operational performance of the federal institution in accordance with the approved budget and performance indicators of business plan. 

For its part, the Council of Ministers will conduct an annual assessment of board performance in accordance with the performance standards specified by the Cabinet.

Mohammad finances the building of a new mosque

Sheikh Mohammed has built Salman Al Farisi Mosque at his own expense. The new mosque, located in Al Hibab area covering 5,279 square metres, has been put under the supervision of the Department of Islamic Affairs and Charitable Activities in Dubai.

Thanking Sheikh Mohammed, Fahad Al-Hajri, Director of Monitoring and Follow-up Department, said the mosque is a new addition to Sheikh Mohammed’s endless charitable deeds.