Corporate Governance

DANAT Corporate Governance Summary

 

Overview

 

DANAT is a wholly owned subsidiary of the Bahrain Mumtalakat Holding Company B.S.C. (“Mumtalakat”) and incorporated as a Closed Shareholding Company in accordance with Article 76 of the Commercial Companies Decree Law promulgated by Decree No. 21 of 2001, as amended. As a Closed Shareholding Company, DANAT is governed by the Bahrain Companies Law and operates in compliance with the Bahrain Corporate Governance Code issued by the Ministry of Industry, Commerce & Tourism (“MOICT”).

 

DANAT’s mandate is to become the world’s leading laboratory for the testing of natural pearls, also playing a vital role in protecting and enhancing public trust in pearls, gemstones and jewellery through its products, services and research. Consequently, effective oversight that ensures the integrity of its representatives and business practices is of the upmost importance to DANAT.

 

Governance Overview

 

DANAT is committed to principle-based, value-driven corporate governance, which is reflected in its goals of achieving good governance, transparency, integrity, performance, and conformance.

 

DANAT’s Corporate Governance Guidelines document the framework, policies and practices for the effective corporate governance of the company, outlining the rights and obligations of shareholders, stakeholders, executive management and the Board of Directors at DANAT. The guidelines have been developed in accordance with key corporate governance principles set out in the Bahrain Corporate Governance Code.

 

Board of Directors

 

DANAT is managed by a Board of Directors of at least three members, appointed by resolution by Mumtalakat, as shareholder. Board members are selected based on their competence and independence to be able to demonstrate judiciousness, experience, objectivity and impartiality in looking into DANAT’s affairs and to ensure complete independence of the executive management and key shareholders. Board members are appointed for a term of three years, which may be renewed. The Board is required to meet on a periodic and regular basis, convening at least four times in the financial year.

 

The oversight responsibilities of DANAT’s Board of Directors are codified in the Board Charter. The Board is expected to maintain effective oversight of organizational performance and conformance by regularly monitoring key business activities and providing directives to DANAT’s Board Committees as part of its fiduciary duties of care and loyalty to DANAT and its stakeholders. DANAT has three committees; the Audit & Risk Committee, Executive Committee and Nomination, Remuneration & Governance Committee. Each committee has a Committee Charter that confirms the roles, responsibilities, scope and authority of the relevant committee. In addition, the Board seeks input from external experts when necessary, to ensure sound business practice and governance.

 

Board Committees

 

Audit & Risk Committee

 

This committee assists the Board in fulfilling its oversight responsibilities regarding the quality and integrity of DANAT’s accounting, internal and external auditing, and reporting practices. This includes ensuring compliance with legal and regulatory requirements as well as internal policies and procedures.

 

Executive Committee

 

This committee addresses specific matters delegated to it by the Board of Directors, making recommendations and decisions thereof. The Executive Committee also reviews and approves business proposals, budgets and major initiatives for subsequent submission to the Board as well as investment opportunities, major procurement and outsourcing matters, as may be delegated by the Board.

 

 

Nomination, Remuneration & Governance Committee

 

This committee assists the Board in formulating a framework for nominating and appointing the directors and senior management of DANAT and its remuneration policies. Furthermore, the committee supports the Board in establishing DANAT’s Corporate Governance framework and monitoring compliance in this regard.