Corporate governance framework

In its effort to act in the best interests of its shareholders by delivering sustainable shareholder value and to ensure compliance with the Corporate Governance Regulations issued by the Capital Market Authority (‘CMA’) of the Kingdom, ACWA Power uses a Corporate Government Framework (the ‘Framework’) that models best practice as defined by the CMA and the Companies Law (‘Law’) of the Kingdom in addition to other applicable benchmark practices and standards.

The Company aims to be a world class entity in its corporate governance affairs by continuing to model its framework in line with international best practice in terms of transparency, sufficient disclosure and fair administration. The IPO process in 2021 was helpful in both confirming the high standard that the Company has achieved ever since it adopted a Code for Corporate Governance in 2009 while it was still a private company and allowing it to identify and capture opportunities to further reinforce and upgrade its governance standards.

The key sources for the application codes (‘Codes’) under the Framework are the Corporate Governance Regulations and the Rules on the Offer of Securities and Continuing Obligations issued by the CMA in addition to corporate governance best practice.

The Company has adopted a Code of Corporate Governance (‘Code of CG’), in line with applicable laws and regulation, which was approved by the Board of Directors of ACWA Power (the ‘Board’) on 7 April 2021 (corresponding with 25 Shaʼaban 1442H) to support and adopt principles of good governance, including, accountability, transparency, responsibility and fairness. Further, the Company, guided by its Board of Directors, continues to assess and examine its governance and agility by comparing its systems with established international practices in order to further strengthen its internal reporting, disclosures and controls.

To ensure the effective, consistent, and continuous application of the governance standards set by the Code of CG, the Company has implemented several policies and manuals, including but not limited to:

• Code of Corporate Governance;
• Board and Board Committee's Charters;
• Policy and procedures for selection of Board Directors, Board committee members and the executive management;
• Remuneration Policy of the Board Directors, Board committees members and the executive management;
• Code of Business Conduct and Ethics Policy;
• Compliance Management Framework;
• Related Party Transaction and Conflict of Interest Policy regulating, amongst other things, conflict categories as it pertains to Directors, senior executives and employees;
• Documentation and Retention Policy;
• Third‑Party Due Diligence and KYC Policy;
• Distribution of Dividends Policy;
• Whistle‑blower Policy;
• Company Stakeholders Policy; and
• Disclosure and Transparency Policy and Procedures.