stc’s Board of Directors has been keen to establish an effective governance system as an integral part of its administrative and financial systems responsible for regulating internal businesses by identifying the relationship between the Board of Directors and the General Assembly, and between the Board of Directors and the Executive Management. This includes organizing external businesses, transactions and relationships with various government and legislative bodies, suppliers and contractors to increase efficiency and effectiveness in realizing stc’s strategic and operational objectives, in a manner consistent with the Companies Law, issued by the Ministry of Commerce; the Corporate Governance Regulation, issued by the Board of Directors of the Capital Market Authority; and other relevant applicable laws and regulations. In addition, this system should be consistent with the aspirations of the Saudi Vision 2030 and stc’s Strategy DARE 2.0, where the latter contains strategic plans and initiatives to enable stc’s governance to manage and implement stc decisions. stc governance leverages local and international best practices in the best interest of stc.

stc governance strives for the highest levels of transparency, disclosures and sustainability, some of the main pillars of the stc’s strategy, which include approving, amending and documenting stc businesses and activities as per pertinent regulatory and legislative authorities. These items include, but are not limited to:

  • Amending stc’s Articles of Association to comply with the New Companies Law issued by the Ministry of Commerce and Capital Market Authority’s relevant implementing regulations, and in alignment with best practices.

  • Updating Board Audit Committee and Board Nomination and Remuneration Committee charters to comply with the New Companies Law issued by the Ministry of Commerce and Capital Market Authority’s relevant implementing regulations, and in alignment with the best practices.

  • Updating Nomination and Remuneration of Board members and the members of its standing committees and remuneration of the Executive Management Policy to comply with the New Companies Law issued by the Ministry of Commerce and Capital Market Authority’s relevant implementing regulations, and in alignment with the best practices.

To ensure the highest levels of transparency, stc is committed to publishing all legally required corporate governance documents on its website (www.stc.com.sa) as listed below:

  • stc’s Articles of Association.

  • stc Governance document.

  • Charters of the Board of Directors and its committees.

  • Governance and compliance policies (Nomination and Remuneration of Board members and the members of its standing committees and Remuneration of the Executive Management Policy, Conflict of Interest Policy, Whistleblowing Policy and the stc code of ethics and business conduct).

Financial information and investor reports were also published on stc’s website, including the financial statements, quarterly and annual financial performance reports, and minutes of the General Assembly meetings. In an effort to enhance digital communication, an investor relations application (stc IR) was launched to provide information on stc shares, latest stc announcements, and the library that contains all stc’s financial statements and annual reports since the establishment and other financial information concern the investors and the analysts. The purpose of the app is to build trust and enhance communication with investors and financial analysts.
The Corporate Governance Regulations requirements issued by the Board of Directors of the Capital Market Authority in Article No 87 under Paragraph No. 1, clearly stipulate the need to implement the provisions of the Company Governance Regulations and to provide the reasons in case of a non-implementation. The Company acknowledges the application of all the provisions mentioned in the Corporate Governance Regulations issued by the Capital Market Authority with the exception of the provisions listed below:

Article No.

84

Article’s Statement

The Ordinary General Assembly, based on the Board of Director’s recommendation, shall establish a policy that guarantees a balance between its objectives and those of the community for purposes of developing the social and economic conditions of the community. (Guiding Article)

Reasons for Not Applying

stc gives the social responsibility subject a special importance, and based on that, stc developed a policy related to social responsibility. Since the article is not mandatory, the approval authority for the policy has been delegated to the Group CEO.

Article No.

92

Article’s Statement

Formation of a Corporate Governance Committee: If the Board forms a Corporate Governance Committee, it shall assign to it the competencies stipulated in Article (91) of these Regulations. The Committee shall oversee any matters relating to the implementation of governance and shall provide the Board with its reports and recommendations at least annually. (Guiding Article)

Reasons for Not Applying

Article No. 47, “Forming the Committees” of the Corporate Governance Regulations, stipulates that the Board of Directors shall form specialized committees as may be needed depending on the Company’s circumstances to enable it to effectively perform its duties. Despite the fact that Article No. 92, “Formation of a Corporate Governance Committee” of the Corporate Governance Regulations is a guiding article, stc’s Board of Directors is cognizant of the importance of the aforementioned Committee’s responsibilities and tasks, which are taken care of by the Nomination and Remuneration Committee as per its charter, approved by the General Assembly on 21 June 2023.

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