Corporate Governance

GPIC’s Corporate Governance system is based on three fundamental components namely; Principles, Code of Conduct and Policies. The system is based on our shareholders aspirations to conduct the company’s business within the acceptable international and local guidelines and standards to ensure full protection of the interest of the shareholders and various other stakeholders.

The company’s Corporate Governance principles have been developed primarily from; the company’s Memorandum and Articles of Association, the Bahrain Commercial Companies Law and Bahrain’s Code of Corporate Governance. These Corporate Governance Principles are responsible for providing a basis and a system of principled goal-setting, effective decision making and ethical actions, with the objectives of establishing a fundamental corporate entity that - on a long term basis - drives value creation to the company’s shareholders and promotes sustainable business conduct in line with the principles outlined in the company’s Articles of Association.

The Corporate Governance Policy of Gulf Petrochemical Industries Company and Bahrain’s Corporate Governance Code resulted in the formation of three high level Committees; the Audit, Finance and Risk Committee, the Remuneration, Nomination and Governance Committee and the company’s Strategy Implementation Committee – 2030. These three committees are created to assist the Board of Directors in the effective performance of their governance and oversight responsibilities.

All Committees are comprised of at least three Directors. Each Director is nominated by Sabic Agri-Nutrients Investments Company (Sabic), Petrochemical Industries Company (PIC) and The Oil and Gas Holding Company (Nogaholding), representing the three shareholders.

The Committee is responsible for overlooking the overall remuneration and nomination process, as well as ensuring the strength of the organization’s governance. The Committee’s main task is to ensure compliance with the Kingdom of Bahrain’s Corporate Governance Code regulations and mandates.

The purpose of the Committee is to assist the Board of Directors in independently ensuring and maintaining oversight of Gulf Petrochemical Industries Co. (“GPIC”).

The Committee is tasked with overseeing such responsibilities, such as; the integrity of the company’s financial statements and financial reporting, internal control and risk management process, internal audit function, independence and performance of the external auditors, compliance with ethics policies and legal and regulatory requirements, governance and other matters as enumerated in the Audit, Finance and Risk Committee Charter.

The purpose of The Company’s Strategy Implementation Committee – 2030 is to conduct a full review and studies of all major projects, as well as reviews and studies of all investment opportunities. The creation of this Committee will help ensure no major projects or investment opportunities have been overlooked and that the company has an optimum investment portfolio.

GPIC’s Internal Audit Section is an independent, objective, assurance and consulting activity designed to add value and improve GPIC’s operations. The internal audit function helps the company accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, internal controls and governance processes.

It contributes to a sound control environment through monitoring the prescribed control procedures. An effective internal audit function can assist all members of Management in effectively discharging their responsibilities by providing them with analysis, appraisals, recommendations and pertinent comments concerning the activities reviewed. In addition, it can provide constructive suggestions for improving the systems. The internal audit function can play a prominent role in enhancing the overall control environment within the Company.

When an organisation reaches a certain size or complexity, such as GPIC, it becomes a challenge for Senior Management to ensure that all the sections within the business are being effectively managed to achieve the Company’s objectives and are performing economically, efficiently and effectively.

The Internal Audit Section, effectively established and resourced, provides reasonable assurance to the Board of Directors and Management of GPIC on whether the controls to manage key risk areas are designed and operating effectively or identify important improvement opportunities where Management actions are necessary.

The GPIC Internal Audit Section reports directly to the Audit, Finance and Risk Committee. For logistical reasons, the Internal Auditor reports to the President for matters relating to time and attendance, leave, travel and other administrative requirements.