Corporate Governance

1. Institutional Commitment

Ajyad Capital B.S.C. (c) is committed to the highest standards of integrity, transparency, accountability, and regulatory compliance. Coordinated in strict alignment with the Corporate Governance Code of the Kingdom of Bahrain, the Central Bank of Bahrain (CBB) Rulebook (Volume 4 – Investment Business), and the Ministry of Industry and Commerce (MOIC) , our governance framework guarantees sound oversight, robust internal controls, and absolute adherence to Islamic Shari'ah principles.

2. Governance Principles

Our operational philosophy is anchored upon seven core institutional tenets:

  • Accountability: Uncompromising clarity in organizational responsibilities and decision-making answerability.

  • Independence: Objective, uninfluenced professional judgment across all governance tiers.

  • Integrity: Absolute adherence to ethical conduct, honesty, and professional excellence.

  • Fairness: Equitable and balanced treatment of all shareholders, clients, and stakeholders.

  • Transparency: Provision of accurate, proactive, timely, and clear institutional disclosures.

  • Prudence: Balanced, risk-aware decision-making aimed at long-term stability and responsible risk-taking.

  • Shari'ah Compliance: Total alignment of our business ecosystem and all investment activities with Islamic financial principles.

3. Corporate Governance Structure

3.1 Board of Directors

The Board is the supreme governing body and ultimate custodian of the Firm's long-term sustainability, strategic trajectory, and fiduciary integrity.

  • Core Mandate: Approves strategic plans, budgets, and capital allocation frameworks ; defines the Firm's Risk Appetite Statement and oversees risk management ; ensures the integrity of financial reporting and regulatory compliance ; appoints, supervises, and evaluates Executive Management ; and ensures absolute adherence to Shari'ah principles across all investment activities.

  • Composition & Independence: Composed of qualified professionals ranging between 5 and 15 Directors, as per the Articles of Association. In alignment with CBB standards, a majority of members are Non-Executive Directors (NEDs) , with at least one-third serving as Independent Directors. The roles of Chairman and Chief Executive Officer (CEO) are strictly separated to maintain check-and-balance integrity.

  • Meetings & Quorum: Meets a minimum of four (4) times annually, with a statutory quorum requiring 50% of members plus one.

3.2 Board Committees

The Board delegates specific oversight mandates to three specialized standing committees:

A. Board Audit, Governance, Risk & Compliance Committee (AGRC)

  • Mandate: Serves as an independent oversight body ensuring financial reporting integrity, the robustness of internal control systems, risk management frameworks, and absolute compliance with regulatory and AML/CFT mandates.

  • Key Responsibilities: Reviews quarterly and annual financial statements ; recommends the appointment, rotation, and fees of external auditors (including lead partner rotation every 5 years) ; protects the functional independence and resourcing of the Internal Audit, Risk, and Compliance functions ; and independently manages the corporate Whistleblowing reporting and escalation matrix.

  • Composition & Frequency: Composed exclusively of Non-Executive and Independent Directors. Meets a minimum of four (4) times annually.

B. Board Executive Committee (BEC)

  • Mandate: Acts as an essential strategic bridge between the Board and Executive Management, addressing core business, strategic, and operational matters between scheduled Board meetings.

  • Key Responsibilities: Conducts rigorous, preliminary evaluations of institutional investment and divestment opportunities prior to full Board presentation ; monitors business performance against the Board-approved budget and strategy ; and reviews and approves transactions or expenditures within its delegated authority thresholds.

  • Frequency: Meets a minimum of six (6) times annually.

C. Nomination & Remuneration Committee (NRC)

  • Mandate: Guarantees that the Firm is steered by highly qualified, "Fit and Proper" leadership while maintaining a balanced compensation framework that promotes a sound institutional risk culture.

  • Key Responsibilities: Identifies and vets candidates for Board vacancies and Controlled Functions ; conducts annual "Fit & Proper" reviews and oversees corporate CBB Form 3 regulatory submissions ; develops and maintains the Group Remuneration Policy ; coordinates the annual performance evaluations of the Board, individual Directors, and committees ; and reviews external directorships to mitigate potential conflicts of interest.

  • Frequency: Meets a minimum of two (2) times annually.

4. Shari’ah Governance Framework

Independent Shari'ah Supervisory Board (SSB)

As a premier Shari'ah-compliant Investment Business Firm, Ajyad Capital operates under the perpetual oversight of a permanent, independent Shari'ah Supervisory Board. Composed of eminent Islamic scholars, the SSB operates under its own Board-approved Charter in absolute accordance with CBB Shari'ah Governance standards and AAOIFI principles.

  • Functional Independence: The SSB maintains complete operational separation from both the Board of Directors and Executive Management. All fatwas, rulings, and structural opinions issued by the SSB are final and binding on the Firm.

  • Oversight Spectrum: Formally reviews and endorses all new investment products, corporate structures, SPVs, and transaction layouts ; issues binding fatwas on business matters ; conducts systematic, periodic transaction audits to verify operational compliance ; and renders an independent Annual Shari'ah Audit Certificate featured within the public Annual Report.

  • Income Purification Policy: The Firm enforces a zero-tolerance policy regarding non-compliant yields. Any inadvertent non-Shari'ah compliant income is instantly segregated, isolated from corporate accounts, and purified via donation to approved charitable entities under strict SSB supervision.

5. Management Governance & Control Framework

5.1 Management Committees

  • Executive Management Committee (EMC): Oversees the Firm's day-to-day operational performance, optimal resource allocation, and tactical execution of Board-approved strategies within delegated authority limits.

  • Management Investment Committee (MIC): Serves as the technical and analytical gateway for investment activities, conducting rigorous reviews of investment and divestment proposals, monitoring portfolio valuations, and ensuring all transactions align with the Firm's Risk Appetite Statement.

5.2 Three Lines of Defense Model

Our risk management framework is structured around the internationally recognized Three Lines of Defense model to prevent operational vulnerability:

  • First Line: Business & Operations

Core Role: Owns, manages, and mitigates risks directly at their point of origin.

  • Second Line: Risk & Compliance

Core Role: Provides independent oversight, designs risk/compliance frameworks, and monitors AML/CFT compliance.

  • Third Line: Internal Audit

Core Role: Delivers completely objective, independent assurance to the Board of Directors and the AGRC.

  • Reporting Independence: To insulate control functions from commercial pressures, the Heads of Risk, Compliance, AML, and Internal Audit maintain dual reporting lines—functionally communicating directly to the Board’s AGRC and administratively to the CEO.

6. Ethics, Corporate Conduct & Stakeholder Rights

6.1 Code of Ethics & Conflict Resolution

  • All Directors, Senior Management, and employees are bound by a restrictive Code of Ethics emphasizing integrity, confidentiality, misconduct prevention, and professional excellence.

  • Directors execute an Annual Declaration of Interests and must immediately disclose any ad-hoc conflicts of interest during board matters. Conflicted Directors must immediately recuse themselves from relevant discussions and voting processes.

  • All Related Party Transactions (RPTs) undergo exhaustive review by the AGRC and require explicit Board approval on strict arm’s-length commercial terms. A centralized Register of Interests is maintained and audited annually.

6.2 Whistleblowing Protection

The Firm maintains a formal, highly confidential whistleblowing framework managed independently by Internal Audit. Stakeholders may report financial irregularities, ethical misconduct, regulatory breaches, or Shari’ah deviations with an absolute corporate guarantee of protection against any form of retaliation or adverse reaction for reports made in good faith.

6.3 Shareholder Empowerment

We protect and facilitate the smooth exercise of fundamental shareholder rights:

  • The right to participate, speak, and vote at all Ordinary (AGM) and Extraordinary (EGM) General Meetings.

  • The authority to approve Board remuneration, vote on material corporate changes (M&A, capital restructuring), and appoint external auditors.

  • Statutory receipt of the audited financial statements and complete Annual Report at least twenty-one (21) days prior to the convention of the AGM.

  • The right to exercise pre-emptive rights on new share issuances.

7. Transparency & Public Disclosures

The Firm publishes a comprehensive Annual Corporate Governance Report alongside its yearly annual report. This disclosure operates as a cornerstone of our corporate transparency and details:

  • Governance Architecture: A comprehensive overview of our internal oversight frameworks, reporting lines, and committee mandates.

  • Board Profiles & Attendance: Detailed professional backgrounds of our Board members alongside their precise meeting attendance records throughout the financial year.

  • Remuneration Disclosures: Fully transparent, granular breakdowns of executive and Board remuneration and benefit packages.

  • "Comply-or-Explain" Declaration: A formal evaluation mapping our absolute alignment with national governance frameworks, clearly detailing the rationale behind any specific operational adaptations.

8. Access to Corporate Governance Disclosures

The Annual Corporate Governance Report is integrated directly as a core section within the Firm’s published Annual Report. Shareholders, regulators, and stakeholders wishing to review our complete governance architecture, board profiles, and remuneration disclosures are kindly requested to refer to the comprehensive annual documents available in the Insights / Annual Reports section of our website.