A strong corporate governance framework is essential for MENA economies as they strive to boost economic growth, strengthen competitiveness and build prosperous societies. The G20/OECD Principles of Corporate Governance and the OECD Guidelines on Corporate Governance of State-Owned Enterprises are a reference in order to build such a framework. This report assesses the corporate governance landscape in the MENA region by identifying challenges and proposing policy options for reform. The findings of the report are based on an analysis of policies and practices in four thematic areas: boosting access to finance and capital markets, improving transparency and disclosure, achieving gender balance in corporate leadership and enhancing the governance of state-owned enterprises in MENA. Overall, the report finds that MENA economies have made progress in strengthening corporate governance frameworks in recent years, but that the region still faces challenges in adopting and implementing corporate governance measures that support economic efficiency, sustainable growth and financial stability.

1. Corporate Governance in
MENA: Building a Framework
for Competitiveness and
Growth
KEY FINDINGS

2. MENA-OECD WORKING GROUP ON CORPORATE GOVERNANCE
 The MENA-OECD Competitiveness Programme (supported by the Swedish
International Development Co-operation Agency) facilitates co-operation between
OECD and MENA economies with the aim to advance inclusive, sustainable and
resilient growth.
 The MENA-OECD Working Group on Corporate Governance supports the
establishment of sound corporate governance frameworks and policies, which are
essential building blocks to boost competitiveness.
 The G20/OECD Principles of Corporate Governance and OECD Guidelines on
Corporate Governance of State Owned Enterprises provide a benchmark for this
work.
 The Working Group brings together securities regulators, stock exchanges and
government from the following jurisdictions: Algeria, Bahrain, Djibouti, Egypt,
Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Palestinian
Authority, Qatar, Saudi Arabia, Tunisia, United Arab Emirates and Yemen.
2MENA-OECD Competitiveness Programme

3. BUILDING A FRAMEWORK FOR COMPETITIVENESS AND GROWTH
 This Report is the fruit of a partnership between MENA and OECD policy makers
throughout 2017-2019. It identifies policy options for improving corporate
governance in four areas: access to capital; transparency and disclosure; gender
balance in corporate leadership; and the governance of state-owned
enterprises.
 Drafts of the four main chapters were discussed at the 2017 meeting of the
Working Group in Rabat, Morocco. In 2018 thematic focus groups with
representatives from MENA economies were established to develop the chapters.
Revised versions with policy options were discussed at the 2018 meeting of the
Working Group held in Lisbon, Portugal.
 The objective of this report is to share the rich reform experience emerging
from the MENA region and to serve as a useful tool for policy makers in search of
effective policy instruments for implementing corporate governance reforms.
3MENA-OECD Competitiveness Programme

4. DEVELOP STRATEGIES FOR CAPITAL MARKET DEVELOPMENT
ALIGN WITH INTERNATIONAL GOOD PRACTICES ON TRANSPARENCY AND
DISCLOSURE
EMPHASISE THE IMPORTANCE OF INCLUDING GENDER DIVERSITY IN POLICY
FRAMEWORKS
4
STRATEGIES FOR CORPORATE GOVERNANCE REFORMS
MENA-OECD Competitiveness Programme
GATHER AND DISCLOSE INFORMATION ON STATE-OWNED ENTERPRISES TO
STRENGTHEN ACCOUNTABILITY AND PERFORMANCE
Overall, the report finds that MENA economies have made progress in strengthening
corporate governance frameworks in recent years, but that the region still faces
challenges in adopting and implementing measures that support the economic
efficiency, sustainable growth and financial stability needed to foster development.
Based on these findings, the report makes the following overall recommendations:

5. 5
FACILITATING ACCESS TO FINANCE AND CAPITAL MARKETS
MENA-OECD Competitiveness Programme
Develop strategies
for capital market
growth
Enhance
capacity of key
institutions
Diversify
sources of
finance
Establish
public markets
for growth
companies
Address issuer
side factors
Develop the
investor base
Enhance a
sound financial
ecosystem
MENA economies could benefit from deepening their capital markets. Capital market
development would increase opportunities for growth companies to access finance
and contribute to the region’s overall economic development. Better corporate
governance is crucial in this regard. Proposed policy options for reforms are:

6. 6
IMPROVING TRANSPARENCY AND DISCLOSURE IN MENA
MENA-OECD Competitiveness Programme
MENA economies should continue their reform efforts with respect to transparency and
disclosure practices. Attention should be devoted to the adoption of international
best practices and to enhancing supervisory authority capacity and shareholder
involvement. Proposed policy options for reform are:
International
standards and best
practice
Effective
supervision and
enforcement
Optimal mix of
mandatory and
voluntary
disclosure
Better
shareholder
engagement
Full and proper
disclosure of
ownership
Full and proper
disclosure of
related party
transactions
Voluntary
improved
disclosure
practice

7. 7
ACHIEVING GENDER BALANCE IN CORPORATE LEADERSHIP
MENA-OECD Competitiveness Programme
MENA has made progress in improving gender balance at the workplace, but the region
still faces common challenges. Removing the barriers to entry and retaining female
talent in corporate leadership requires efforts at multiple levels. Proposed policy
options for reform are:
Promoting gender
balance in
corporate
leadership
Reform legal and
policy frameworks
Combine
measurable
national goals with
company
strategies
Improve data
collection and use
Attract talent and
limit pipeline
issues
Facilitate networks
and provide
support for women
in the corporate
world
Create a conducive
cultural
environment

8. 8
ENHANCING GOVERNANCE OF STATE-OWNED ENTERPRISES
MENA-OECD Competitiveness Programme
MENA governments have taken steps to harmonise state ownership and governance
practices, but these remain dispersed across MENA economies. Establishing a clear
overview of the state-owned enterprise landscape is a crucial starting point for designing
effective ownership reforms. Proposed policy reforms are:
International
standards and best
practice
Structured
information on
the SOE
landscape
Clarity on the
roles of state
ownership,
regulatory and
audit bodies
Well-defined
performance
objectives for
SOEs
Data on SOEs'
financial and
non-financial
performance
Harmonised
governance
standards for
the SOE sector
Aggregate
reports on SOEs'
operations and
performance

9. This Report is published under the work of the MENA-OECD Working Group on Corporate Governance. More information
about the Working Group is available at: http://www.oecd.org/mena/competitiveness/mena-corporate-governance.htm
The OECD Secretariat welcomes any questions and comments. Please address these to:
Fianna Jurdant
Manager, MENA-OECD Corporate Governance Working Group
Corporate Governance and Corporate Finance Division
OECD Directorate for Financial and Enterprise Affairs
Tel. +(33-1) 45 24 79 25
email: fianna.jurdant@oecd.org