Families wield power in companies across GCC

Dubai: Families wield considerable power in the boardrooms of listed companies across the GCC, according to a new research.

Between one-quarter and three-quarters of all publicly traded companies have at least two members from the same family on their boards.

In Kuwait, a single family can own up to 100 per cent of a board, while in Saudi Arabia the control could extend up to 75 per cent, the study by Abu Dhabi-based investment bank The National Investor (TNI) found.

In both Abu Dhabi and Bahrain, a family could control a maximum of 66.7 per cent of the board, while in Qatar and Oman this could be 70 and 60 per cent respectively. In Dubai, this percentage was the lowest at 50 per cent, making the emirate a better performer in corporate governance.

On average, wealthy business families hold between 19 per cent and 30 per cent of all company board seats in the GCC.

"Individual power is fairly diluted but family power is high," said the report - 'Power Matters: A Survey of GCC Boards.'

"It is no secret that the economic landscape in the GCC is controlled by families," said the study, which studied 4,254 board members and was published in collaboration with the Dubai government's Hawk-amah Institute for Corporate Governance.

The representation of women on company boards in the GCC remains low compared to international benchmarks, despite the growing number of Arab women entrepreneurs.

Women representation

In about 580 companies covered, only 63 seats were held by women, representing 1.5 per cent of the total.

The study dispelled the perception of Gulf companies having a high cross-board membership. It found that 80 to 90 per cent of individual directors are on a single board across the GCC. On the size of a board, there was no uniformity in different countries.

The maximum size of boards for Abu Dhabi and Bahrain was 15 compared to 11 for both Dubai and Kuwait.

statistics

listed companies

- Abu Dhabi 62

- Bahrain 46

--Dubai 39

--Kuwait 177

--Oman 128

--Qatar 38

--Saudi Arabia 94

Source: TNI