The following is a description of the EII’s corporate governance principles and current practices which are reviewed regularly by the Board of Directors. This description is designed to provide our shareholders and partners with a better understanding of the various elements of corporate governance at EII.
Responsibilities of the Board
Role of the Board
The basic responsibility of the Directors of the Board is to exercise their reasonable business judgment on behalf of the shareholders. In discharging this obligation, Directors rely on, among other things, EII’s officers, outside advisors and auditors. The Board of Directors appoints the Chief Executive Officer (CEO) who is charged with managing the business and appointing other corporate officers. The Board of Directors oversees the CEO to ensure the long-terms objectives of EII and its partners are achieved. The Board’s general oversight responsibilities include, but are not limited to, the following:
- Providing adequate support and resources to the CEO.
- Promoting EII’s image within the “Emaar Group” and external community.
- Approving the corporate strategy and performance objectives of the Company and its subsidiaries.
- Monitoring / assessing performance of the EII, Board Committees, management and major initiatives.
- Monitoring and managing potential conflicts of interest of management, Board members and stakeholders, including misuse of corporate assets and abuse in related party transaction.
- Reporting to shareholders.
CEO Performance Evaluation
Proper evaluation by the Board of Directors of the performance of the CEO is imperative. At the beginning of each year, the CEO presents his performance objectives to the Board of Directors for their approval. At the end of the year, the Board of Directors meets privately to review the CEO’s performance against the approved performance objectives. The Board of Directors provides the CEO with feedback on his performance and decides on the CEO’s remuneration in accordance with EII’s policies and procedures. In addition, the Board of Directors ensures that feedback on the CEO’s performance is not a one-off event and that there is constant evaluation of his performance throughout the year.
Ethics and Conflicts of Interest
A Code of Business Conduct (Code) governs EII and its subsidiaries’ commercial operations and the conduct of Directors, employees, consultants and any person(s) representing EII or its subsidiaries. EII does not solely rely on the Code to ensure ethical conduct by all parties; it relies on the ethical behavior of its Board of Directors which sets an ethical for our partners, employees and other stakeholders. The Board of Directors expects all internal and external parties involved with EII to act ethically at all times and acknowledge their adherence to the Code of Business Conduct. Shareholders & partners may access a copy of the Ethics Handbook from here. This Handbook acts as a high level summary of the Code.
In addition, if any actual or potential conflict of interest affects a member of the Board, then that member will inform the Chairman of the Board and Company Secretary who will take the required action. Board members will not engage in any discussion or vote affecting their personal, business or professional interests.
Board Composition
Board Size and Composition
The Board of Directors will consist of 5 – 11 members a majority of which will be UAE Nationals. Similarly, the majority of the Board of Directors will be independent non-executive Board members (i.e. they will not be members of EII’s management team) and the Chairman of the Board will not be or act as the CEO.
Selection of Directors
The Board will engage in a disciplined process to determine, in light of the opportunities and risks facing the EII, what competencies, skills, and personal qualities it should seek in new Board nominations in order to add value to the shareholders and partners. Shareholders may propose Board member nominees in accordance with the procedures set forth in the Articles of Association. These nominations will be put forward to the General Assembly every 3 years for the shareholders to vote on.
The Chairman of the Board and the Vice-Chairman will be elected by the Board.
Each Board member will serve for a 3 year term from his/her appointment. Board members can serve an unlimited number of terms.
Outside Board Memberships
Taking into account the restrictions set by UAE Federal Law, the Company acknowledges the value in having Board members with significant experience in other businesses and activities. However, it is the policy of EII to ensure that no Board member shall sit on the Boards of competitors.
Director Compensation
The level and composition of remuneration for Board members should be sufficient and reasonable to attract and maintain talented individuals to fulfill such roles. On an annual basis the Board of Directors will approve the details of Board member remuneration. Remuneration will be partly fixed, partly variable and will also be based on the number of Board committees a Board member serves on.
Board and Committee Meetings
Board Agenda and Meetings
The CEO establishes the agendas for Board meetings and circulates them to other Board members or other relevant persons through the Company Secretary. Each Director is free to suggest items for the agenda, and each Director is free to raise, at any Board meeting, subjects that are not on the agenda for that meeting. Information and data that are important to the Board’s understanding of the matters to be covered at a Board meeting will be distributed to the directors before the meeting.
The Board will meet at least 3 times per year as necessitated by its business operations. Directors are expected to attend all Board meetings, as well as the annual meeting of shareholders. Minutes of meetings will be kept, signed and preserved as a complete, accurate and objective account of the proceedings of meetings.
Director Access to Officers and Employees
Directors have full and free access to management and employees of the Company.
Committees of the Board
The Board has the following 2 committees: Executive & Audit. All members of the Audit Committee shall not be members of the Executive Committee. Each committee has a written charter, approved by the Board, which describes the committee’s general authority and responsibilities.
Independent Advice
The Board and its committees may seek legal, financial or other expert advice from a source independent of management.
Board and Committee Performance Evaluation
With the goal of increasing the effectiveness of the Board and its relationship to management, the Board of Directors will conduct a self evaluation of its performance as a whole. The evaluation process, which occurs annually, includes a survey of the individual views of all Board members, which are then shared with the full Board. In addition, each of the committees performs a similar annual self-evaluation.
Director Orientation and Continuing Education
All new Board members must participate in the Company’s Orientation Program. This orientation will include presentations by the CEO and senior management to familiarize new Directors with the EII’s strategic plans, significant financial, accounting and risk management issues, compliance programs, the Code of Business Conduct, its principal officers, and internal and independent auditors.
In addition, Board members shall receive training on at least an annual basis in conjunction with regularly scheduled Board meetings, on industry issues, financial performance, EII’s strategy and economic updates.
