HC-8.1.2

All members of the board of directors should understand the Board's role and responsibilities under the Bahrain Commercial Companies Law (2001) and its amendments and any other laws or regulations that may govern their responsibilities from time to time. In particular:

HC-8.1.3

The Board's role and responsibilities include but are not limited to:

HC-8.1.4

The members of the board of directors are responsible both individually and collectively for performing the responsibilities outlined in Paragraph HC-8.1.3. Although the Board may delegate certain functions to committees or management, it may not delegate its ultimate responsibility to ensure that an adequate, effective, comprehensive and transparent corporate governance framework is in place.

HC-8.1.5

When a member of the board of directors is inducted, the chairman of the Board, assisted by company legal counsel or compliance officer, should review the Board's role and duties with that person, particularly covering legal and regulatory requirements and Module HC.

HC-8.1.6

The licensee should have a written appointment agreement with each director which recites the directors' powers and duties and other matters relating to his appointment including his term, the time commitment envisaged, the committee assignment if any, his remuneration and expense reimbursement entitlement, and his access to independent professional advice when that is needed.

HC-8.1.7

The Board should adopt a formal Board charter or other statement specifying matters which are reserved to it, which should include but need not be limited to the specific requirements and responsibilities of board directors.

HC-8.1.8

The Board should have no more than 15 members, and should regularly review its size and composition to ensure that it is small enough for efficient decision-making yet large enough to have members who can contribute from different specialties and viewpoints. The Board should recommend changes in Board size to the shareholders when a needed change requires amendment of the licensee's Memorandum of Association.

HC-8.1.9

Potential non-executive directors should be made aware of their duties before their nomination, particularly as to the time commitment required. The Board should regularly review the time commitment required from each non-executive director and should require each non-executive_director to inform the Board before he accepts any Board appointments to another company. One person should not hold more than three directorships in public companies in Bahrain with the provision that no conflict of interest may exist, and the Board should not propose the election or reelection of any director who does.

HC-8.1.10

The Board should be collegial and deliberative, to gain the benefit of each individual director's judgment and experience.

HC-8.1.11

The chairman should take an active lead in promoting mutual trust, open discussion, constructive dissent and support for decisions after they have been made.

HC-8.1.12

The Board should meet frequently but in no event less than four times a year. All directors should attend the meetings whenever possible and the directors should maintain informal communication between meetings.

HC-8.1.13

The chairman should ensure that all directors receive an agenda, minutes of prior meetings, and adequate background information in writing before each Board meeting and when necessary between meetings. All directors should receive the same Board information. At the same time, directors have a legal duty to inform themselves and they should ensure that they receive adequate and timely information and should study it carefully.

HC-8.1.14

The Board should encourage participation by management regarding matters the Board is considering, and also by management members who by reason of responsibilities or succession, the CEO believes should have exposure to the directors.

HC-8.1.15

Non-executive directors should have free access to the licensee's management beyond that provided in Board meetings. Such access should be through the Chairman of the Audit Committee or CEO. The Board should make this policy known to management to alleviate any management concerns about a director's authority in this regard.

HC-8.2.2

The licensee should disclose to its shareholders in the Annual Report any abstention from voting motivated by a conflict of interest and should disclose to its shareholders any authorisation of a conflict of interest contract or transaction in accordance with the Company Law.

HC-8.3.2

To encourage management accountability for the financial statements required by the directors, the licensee's CEO and chief financial officer should state in writing to the audit committee and the Board as a whole that the licensee's interim and annual financial statements present a true and fair view, in all material respects, of the licensee's financial condition and results of operations in accordance with applicable accounting standards.

HC-8.4.2

The chairman of the Board should ensure that each new director receives a formal and tailored induction to ensure his contribution to the Board from the beginning of his term. The induction should include meetings with senior management, visits to company facilities, presentations regarding strategic plans, significant financial, accounting and risk management issues, compliance programs, its internal and external auditors and legal counsel.

HC-8.4.3

All continuing directors should be invited to attend orientation meetings and all directors should continually educate themselves as to the licensee's business and corporate governance.

HC-8.4.4

Management, in consultation with the chairman of the Board, should hold programs and presentations to directors respecting the licensee's business and industry, which may include periodic attendance at conferences and management meetings. The Board should oversee directors' corporate governance educational activities.

HC-8.6.2

The Board should appoint senior management whose authority should include management and operation of current activities of the licensee, reporting to and under the direction of the Board. The senior managers should include at a minimum:

and should also include such other approved persons as the Board considers appropriate and as a minimum should include persons occupying controlled functions as outlined in Paragraph AU-1.2.2.

HC-8.6.3

For purposes of HC-8.6.2 (c) given the nature, scale and complexity of its business, licensees may appoint a part-time or a seconded corporate secretary.

HC-8.6.4

The Board should adopt by-laws prescribing each senior manager's title, authorities, duties and internal reporting responsibilities. This should be done in consultation with the CEO, to whom the other senior managers should normally report.

HC-8.6.5

These provisions should include but should not be limited to the following:

HC-8.6.6

The Board should also specify any limits which it wishes to set on the authority of the CEO or other senior managers, such as monetary maximums for transactions which they may authorise without separate Board approval.

HC-8.6.7

The corporate secretary should be given general responsibility for reviewing the licensee's procedures and advising the Board directly on such matters. Whenever practical, the corporate secretary should be a person with legal or similar professional experience and training.

HC-8.6.8

At least annually, the Board should review and concur in a succession plan addressing the policies and principles for selecting a successor to the CEO, both in emergencies and in the normal course of business. The succession plan should include an assessment of the experience, performance, skills and planned career paths for possible successors to the CEO.

HC-8.7.2

The Board should observe both the letter and the intent of the Company Law's requirements for shareholder meetings. Among other things:

HC-8.7.3

Licensees should require all directors to attend and be available to answer questions from shareholders at any shareholder meeting and, in particular, ensure that the chairs of the audit, remuneration and nominating committees are ready to answer appropriate questions regarding matters within their committee's responsibility (it being understood that confidential and proprietary business information may be kept confidential).

HC-8.7.4

Licensees should require its external auditor to attend the annual shareholders' meeting and be available to answer shareholders' questions concerning the conduct and conclusions of the audit.

HC-8.7.5

Licensees should maintain a company website. Licensees should dedicate a specific section of its website to describing shareholders' rights to participate and vote at each shareholders' meeting, and should post significant documents relating to meetings including the full text of notices and minutes. Licensees may also consider establishing an electronic means for shareholders' communications including appointment of proxies. For confidential information, licensees should grant a controlled access to such information to its shareholders.

HC-8.7.6

In notices of meetings at which directors are to be elected or removed licensees should ensure that: