Family Business in Saudi Arabia: Role Model for Corporate Governance

Anees Ahmed Moumina, CEO of SEDCO Holding talks about the family business in Saudi Arabia and corporate governance.

He says, “Right now, corporate governance is a buzz word in Saudi Arabia and in the region. In corporate governance, we are aiming at separating ownership from management. A lot of companies or family businesses do not realize that this is a long journey. The Saudi economy is characterized by a large percentage of family-owned businesses. I was in the banking sector before. I noticed there that there are a lot of companies that had very good business models, good management, but whenever there is a dispute at the ownership level, everything else just collapses. So, it is important to have a sustainable structure for family businesses to service the current generation. “

“Decisions at the board can be taken by non-family members. This is unheard of here. It is not common practice here in Saudi Arabia. We have won a number of awards because of our corporate governance and our corporate structure. We are also invited to a lot of events to hold presentations on the SEDCO model. It is a very important point. The families have to understand this and they should start following suit before issues arise. Because once issues arise within the family, it is too late to start talking about corporate governance and separation of ownership and management,” he adds.