The Securities Commission has come up with guidelines to enable MESDAQ companies to provide greater emphasis on transparency, corporate governance, quality and investor protection.

By doing so, the SC hopes that these measures would raise the profile of the MESDAQ Market and improve the quality and standards of MESDAQ companies to bring greater benefits to the investors and shareholders in the market.

The key changes touching on corporate governance, disclosure and transparency were:-

Enhancing Corporate governance framework by:

• Increasing the prescribed minimum number of independent directors on the boards of listed companies,
• Disqualifying certain persons from acting as directors or being involved in the management of companies;
• Enhancing the requirements relating to audit committees.
• Inserting an audit committee report with prescribed minimum information in the annual report.
• Disclosing in their annual reports, their governance practices and to explain departures from the best practices.
• Ensuring that the statements on internal control in the annual reports are reviewed by external auditors.

Enhancing Corporate disclosure and transparency by:

• Stricter standard of disclosure for announcements,
• Prescribing a specific standard of disclosure for circulars,
• Prescribing and enhancing the minimum content of announcements and circulars for certain types of events,
• Requiring specific disclosures of dealings in securities by the MESDAQ company, Enhancing the prescribed minimum contents for annual reports.

Enhancing the framework for Related Party Transactions:

• Introducing a new framework for related-party transactions where only transactions that trigger 5% are required to be approved by shareholders. Only recurrent related party transactions that exceed a certain threshold are required to be disclosed to the market.
• Expanding the list of transactions which are classified as being non-related party transactions.
• Appointing an independent adviser to advise minority shareholders on the transactions.
• Appointing a main adviser in addition to the independent advisor where the size of the related party transactions hits a threshold of 25%.