19% constitute of the total cases filed in 2012
Violations of the Corporate Governance Regulations rise 89% during the year
The average growth in the number of fines imposed by the financial market authority system listed companies, 24.5 per cent, over four years, from 2009 to 2012, figures show that the number of breaches of corporate governance regulations were eight cases, jump to 51 at the end of the analysis. In 2012 the largest number of violations of those regulations, to represent the 19 per cent of the total number of violations, the total number of offences in 2012 was 270, 12 bit Irregularities concerning regulations and other regulations, and violations of corporate governance regulations second arrangement in terms of the number of cases of irregularities. The number of cases of violations of rules of governance grew by 89 per cent in 2012 compared with 2011recording 27 cases. In contrast, the number of investigation cases of suspected violations of capital market Law 269 in 2012, was violating corporate governance regulations of 15.2 per cent in the number of 41 suspected cases. This won the second highest.
Also recorded an annual growth of 17 per cent, with the number of offences 35 suspected case at the end of 2011, to record the average annual growth of 25 percent in the past four years. On a related level, the quarterly financial statements of listed companies, received the reservations by the capital market authority, 47 note at the end of 2012, compared to 41 note at the end of 2011; no reservations to the interim financial statements has grown annually by 14.6 per cent. These reservations are up since 2006, which was at 25. In the same context, there were reservations on the annual financial statements increased by 15.8 per cent at the end of 2012, Compared to the previous year, to settle at 44, compared to 38. It should be noted that reservations to such annual financial statements were recorded 20 cases of reservation by the end of 2006. these figures indicated that the number of irregularities in corporate governance regulations to increase in the next few years, especially since the number of listed companies on the rise, and the market value of the shares issued for all companies for up to $ 1.8 trillion in 2013, compared with $ 1.4 trillion in 2012 comes to apply corporate governance regulations in the financial sector, the fact that the sector is growing at a good rate, with consensus prospects in the foreseeable future to continue its growth momentum, with a traded value of market instruments and bonds 151.22 billion at the end of 2013, While the nominal value for the same period 226.7 billion riyals. This coincides with the growing role of the Saudi economy and effective contribution to the global economy, and the local authorities at this time, the strategic plans of the intensification of material and logistical support to the Government and private sectors, with a view to promoting the growth of the GDP for Saudi economy, corporate governance is important, for its role in raising the levels of economic efficiency, which in turn promotes the same companies in the face of economic fluctuations, as well as to support the level of transparency that will increase the effectiveness and the recovery of several pillars of the economy, including attracting foreign investment and strengthening the participation of local investment and to support the stability of the Money markets. Governance Application mechanisms of high levels of threats to any economic and administrative system, corporate governance works to improve levels of confidence and macroeconomic stability, as well as to companies in an economy run with an integrated system of tools and strategies, which ensure them to be value-added to the economy. And facilitate the application of governance process companies get the financing needs in the first place and reduce current and future risks faced by companies in the second place, the work of corporate governance standards than bridges of trust between them and the other parties, and protects the rights of investors and shareholders. The CMA has that side, where the corporate governance regulations issued in Saudi Arabia, as some additions and amendments from time to time since the regulation was issued in September 2006. It has also gradually requiring listed companies in the stock market in the application of certain provisions, and others are kept as guiding lines, with the application of the principle of punishment does not comply with the mandatory items, due to growth in monitoring breaches of corporate governance regulations, a number of challenges facing the financial market requires it to reconsider the value of irregularities and regulation mechanisms apply, for example, the presence of a large number of family businesses, and control of family ownership and management in those companies, the employment of relatives and acquaintances, more than conflict of interest. As well as the lack of familiarity with the rules and regulations for financial market regulation, accompanied by the low awareness of the importance of these decisions, risks arising in the absence of their application. The penalty is deterrence and amounts paid for such irregularities are not commensurate with the situation of these companies, perhaps the more appropriate capping, most minimum, commensurate with the level of activity and the size of the market in which the company operates, this decision will contribute to the non-recurrence of violations, particularly in some sectors which should have a high sensitivity to governance, applications and more mature nature of the sector, and the reputation of the local economy. Also supposed to put some different mechanisms which are strongly and precisely those companies over small capitalization companies.