Corporate Governance


Overview

At SICO Capital, strong corporate governance is fundamental to maintaining the trust of our clients, shareholders and stakeholders. We are committed to operating with the highest standards of integrity, transparency and accountability.

Our governance framework is designed to ensure full compliance with all applicable laws and regulations in the Kingdom of Saudi Arabia, including those issued by the Capital Market Authority (CMA), while aligning with leading international practices and SICO Group standards.

The Board of Directors plays a central role in overseeing the Company’s strategic direction, financial performance and regulatory compliance, ensuring sustainable value creation and effective risk management.

Governance Framework

SICO Capital has established a comprehensive governance framework that includes:

  • Board and Committee Charters
  • Code of Conduct and ethical standards
  • Risk management and internal control systems
  • Compliance and Anti-Money Laundering (AML) frameworks
  • Internal and external audit functions
  • Delegated Authority Limits
  • Transparent disclosure and reporting practices

This framework supports disciplined decision-making, accountability and operational integrity across the organisation.

Board of Directors Composition

The Board comprises a balanced composition of non-executive and independent directors, ensuring diversity of experience, expertise and independent judgement. Currently, the Board consists of seven non-executive members, including three independent directors, in line with CMA governance requirements.

Appointments and Elections

Directors are elected by shareholders resolution and are subject to compliance with the regulatory requirements and approval of the CMA.

Independence

The Company applies a formal independence framework in accordance with regulatory requirements. Independent Directors are free from relationships that could materially affect their objectivity or decision-making.

Responsibilities

The Board is responsible for:

  • Setting the Company’s strategy and objectives
  • Overseeing management performance
  • Approving major investments and capital allocation
  • Ensuring effective internal controls and risk management
  • Approving financial statements and budgets
  • Ensuring compliance with regulatory requirements

The Board operates under a formal Charter defining its roles, responsibilities and governance processes.

Board Meetings and Evaluation

The Board meets regularly to review strategy, performance, compliance with the regulatory framework and key risk matters, and at least once per quarter.

The Board held five meetings during 2025, ensuring continuous oversight of the Company’s operations and regulatory obligations.

In line with best practices, the Board conducts periodic evaluations of its effectiveness, as well as the performance of individual Directors and Board Committees, to support continuous improvement.

Board Committees

To support effective governance and specialised oversight, the Board has established the following committees:

The Board Audit Committee

Responsible for overseeing:

  • Financial reporting integrity
  • Internal controls and audit processes
  • Risk management and AML framework
  • Compliance with regulatory requirements

The Committee also reviews audit findings and supports engagement with regulators where required.

The Board Investment Committee

Responsible for:

  • Oversight of investment activities and credit exposures
  • Review and approval of transactions within delegated limits
  • Monitoring financial performance
  • Reviewing strategic and business plans

The Board Nomination and Remuneration Committee

Responsible for:

  • Board and senior management appointments
  • Succession planning
  • Remuneration frameworks
  • Governance and Board composition

The Committee ensures an appropriate balance of skills, experience and independence, and reviews the independence of Directors on an annual basis.

Remuneration Governance

Remuneration policies are designed to:

  • Align with market practices and regulatory expectations
  • Support long-term value creation
  • Promote prudent risk-taking

Board and senior management remuneration is disclosed in accordance with CMA requirements and approved by shareholders where applicable.

Risk Management

Risk management is an integral part of SICO Capital’s governance framework.

The Board has overall responsibility for risk oversight, supported by the Audit Committee. An independent Risk Management function is responsible for:

  • Identifying and assessing risks
  • Monitoring risk exposures
  • Ensuring adherence to approved risk policies and limits

The framework is designed to balance risk and return, safeguard financial stability and support sustainable growth.

Internal Audit and Controls

SICO Capital maintains an independent Internal Audit function that:

  • Evaluates the effectiveness of internal controls
  • Identifies control gaps and recommends improvements
  • Monitors the implementation of audit findings

Internal audits cover all key business and support functions, including compliance, AML, risk management and operations.

Compliance and Anti-Money Laundering (AML)

The Company maintains a robust Compliance framework aligned with CMA regulations and applicable AML/CFT requirements.

An independent Compliance function is responsible for:

  • Regulatory reporting
  • Monitoring adherence to laws and regulations
  • Managing AML controls

A designated Money Laundering Reporting Officer (MLRO) oversees AML processes supported by appropriate monitoring systems.

The Company maintains a strong track record of regulatory compliance, with no material penalties or restrictions.

Shariah Governance

SICO Capital offers Shariah-compliant investment products across selected asset classes, including equity, real estate and fixed income.

A formal Shariah governance framework ensures that these products are structured and managed in accordance with approved Shariah principles. This includes:

  • Obtaining Shariah approval prior to product launch
  • Conducting periodic reviews of investment activities
  • Monitoring compliance with approved criteria

An independent Shariah Committee, represented by the Shari’a Review Bureau, provides oversight and guidance.

External Audit

SICO Capital ensures full compliance with CMA regulations and applicable laws. Financial statements are subject to:

  • Regular internal review
  • Independent external audit on an annual basis

Related Party Transactions and Conflicts of Interest

All related party transactions are conducted on an arm’s length basis and in accordance with internal policies and regulatory requirements.

Directors and employees are required to:

  • Disclose any conflicts of interest
  • Abstain from related decision-making
  • Ensure transparency in all dealings

Code of Conduct and Ethics

SICO Capital is committed to the highest standards of ethical conduct. The Code of Conduct governs:

  • Conflict of interest management
  • Confidentiality
  • Fair and equitable treatment
  • Professional behaviour

Whistleblowing

The Company maintains a whistleblowing framework that encourages employees to report concerns in good faith, including:

  • Violations of laws or policies
  • Fraud or misconduct
  • Control deficiencies

All reports are treated with confidentiality and investigated in accordance with established procedures.