Business & Money | Tuesday 3 February, 2015 12:03 am |

Corporate governance can become an integral part of a corporate culture only if it stems from the senior management, namely, from the Board of Directors and Chief Executive Officers. Integrity, transparency and accountability are the mainstay of a good governance structure and every employee must abide by them. Furthermore, the human capital or the work force of a company is one of its most valuable assets and the major driving force behind its success or failure.

Consequently, what is the impact of corporate governance on the work environment? How can family businesses gain the loyalty of their staff and recruit best talents?

SEDCO Holding Group has embarked, over the past few years, on a studious exercise of transforming itself into a company that adheres to best practices of corporate governance. It utilizes this practice to serve as a role model for family businesses in the Kingdom and the Middle East to bring about real change in the professional work environment. To this regard, Anees Ahmed Moumina, CEO of SEDCO Holding Group has said: “we manage assets and investments in various countries worldwide. Therefore, we are eager to build and promote a solid framework for good governance in line with best global practices and which match our specificities”.

Family businesses account for three quarters of private companies in the Gulf that operate in trade, financial services, real estate and construction. Such companies are newly established given that most of them were set up in the 1970’s. Today, they are undergoing major transformations in a bid to boost their strategies and operations to ensure their sustainability in a business environment that is growing increasingly complex.


This then becomes the right time to start thinking of how to enhance the corporate structure in order to identify the required skills to enable companies to work towards the next phase of growth. This is especially the case since competition is becoming increasingly stiff under the constant change of the current business scene in addition to regional companies’ attempts to strengthen their ties with global companies and vice versa. Local companies however continue to gain the upper hand over their international counterparts because global companies prefer collaborating with local companies for the latter’s expertise in Gulf markets. However, given the increase in family businesses, the options have become broader for both local and global companies. What is certain is that successful companies will be built on best practices so long as wise governance bolsters confidence and reassures the staff and business partners that all the stakeholders share the same values and seek to attain the same objectives.

Amro Kandil, Vice President of Human Resources at SEDCO Holding Group, stated: “Attracting best talents and gaining staff loyalty constitute the factors of success and longevity of any company”. The Group has implemented a number of programs designed to promote best practices among the staff. He then added: “The human element is our most valuable asset. We have focused on shaping an overall understanding of the working mechanisms of the Group level and have encouraged people to think in a sense of team spirit and to benefit from the harmony and complementarity among the various business units of our companies”.

Training, skills development and consolidation of an innovative corporate culture should be among the top priorities of family businesses that aspire to accelerate growth. As for mutually beneficial expertise and resource exchange among inter-related companies, major family businesses, in particular holding groups, can help increase growth of their businesses at a fast pace through talent enhancement and greater efforts, thereby creating an environment that encourages staff to exchange knowledge and resources simultaneously.

Moreover, fair practices of evaluation and accountability of officials among family members and non-family members promote principled behavior across all sections of the company. Any company which cultivates the best practices of corporate governance and upholds an advanced system of performance evaluation and reward allocation attracts the best talent in the market.

SEDCO Holding Group also lay emphasis on initiatives of the Corporate Social Responsibility Department - under the “Towards Sustainability” slogan, which falls under three basic pillars: “Our Environment – Our People – Our Community”. Apart from business growth, the initiatives are designed to foster closer ties within the work environment and the society and to promote loyalty through the encouragement of proper behavior toward the staff, the society and the environment.

In a bid to promote healthy and positive habits, SEDCO Holding Group has come up with a set of initiatives under the slogan “Our People” through which it provides health, volunteerism and development programs such as “Be healthy”. The latter comprises several health-related and sporting events such as the “SEDCO Football Cup”, “It’s better to take the stairs” and weight loss campaigns such as “Mezan AlKhair”, etc.

Other initiatives exist such as the “Volunteer Your Skill” initiative, designed to promote volunteerism among the staff, the “Tawasul” program, designed to foster interaction among the Group’s staff at various events, the “Injaaz” program, designed to assess performance and build capacity, the “Employee of the Month” program, designed to serve as an incentive for outstanding achievement and the “SEDCO Group Stars” program, designed to spur employees who have the potential to climb the employment ladder rapidly.

Driven by a sense of responsibility toward the environment and the society and under the “Our Environment” slogan, the SEDCO Holding Group has sought to improve the working environment by launching green office initiative, recycling as well as water and electricity saving campaigns so as to ensure that buildings are green and environment friendly. SEDCO Holding also takes part in “Earth Hour”.

Under the “Our Community” slogan, SEDCO Group played a prominent role in presenting the “Riyali” financial literacy program, which had a significant impact on the youths and kids in terms of improvement of financial habits, budgeting, saving, investment, borrowing and proper handling of money. In addition to other efforts that companies of the SEDCO Group and the Salim Bin Mahfouz Foundation make to serve the society.

Such significant transformations that stem from the implementation of new programs and initiatives at the company should be monitored properly in order to measure results. At SEDCO Holding Group, surveys are regularly conducted to assess the staff’s interaction with the Group’s plans and to ascertain their loyalty. Based on the conclusions of such studies, the operational companies are provided with valuable information to help them develop business plans designed to introduce greater improvements at the workplace.

The Group’s CEO added: “the approach we have adopted with regard to corporate governance from the standpoint of human capital, focuses on the development of human resources and adherence to best work practices in addition to instituting a reward system for performance. Due to the appointment of external members to the Board of Directors, the work has acquired a new perspective and helped us gain the trust of our business partners, staff and all of our stakeholders.”

Most local family businesses are currently grappling with the reality of generational succession, with the majority of them being run by the second generation, while only 20% of such businesses are being run by the third generation. As for GCC nations, succeeding generations tend to be double the number of the founding generation. As a result, the responsibilities keep rising. Despite the challenges that such developments entail, the phenomenon indicates the need to have a solid managerial team to oversee daily business and steer the company to sustainable growth.

Anees Moumina concluded: “Since 2004, SEDCO Holding Group has been undergoing the process of separating ownership from the Group’s management by appointing the first CEO from outside of the family. We take pride in our accomplishments which were achieved in an environment of team spirit and we keep striving to adhere to the best practices of corporate governance because we realize that such practices will help us reach higher horizons.”