6.Without prejudice to the provisions of article(1) of the Implementing Regulations of the Law on Supervision of Cooperative Insurance Companies issued by decision of H.E. the Minister of Finance No. 1/596 dated 01/03/1425H, the following terms and expressions wherever mentioned in this Regulation shall have the meanings shown assigned thereto unless the context requires otherwise:

SAMA: the Saudi Arabian Monetary Agency (SAMA).
 

Board of Directors (the Board): the Company's Board of Directors as accepted by the laws in the Kingdom of Saudi Arabia.

Chairman of the Board (Chairman): a Non-executive Board Member elected by the Board to preside over its meetings and organize its activities.

Chief Executive Officer (CEO): the officer with highest rank in the senior executive management of the Company, who is in charge of its daily management, regardless of the title of his or her position.

Company (Companies): the insurance and/or reinsurance company licensed by SAMA under the Law of Supervision of Cooperative Insurance companies and its Implementing Regulations (or the insurance service provider required by SAMA to comply with some or all of the requirements of this Regulation based on Article (3) of this Regulation).

Related Company: a company (or one of several companies that SAMA may consider to be acting in concert) holding a shareholding of 5% or more of the equity of the Company, or a company in which the Company (either alone or with other companies that SAMA may consider to be acting in concert) holds a shareholding of 5% or more.

Related Persons: close family members of parents, spouse, descendants; any person with a business relationship that might influence the decision making process; and any establishment in which any member of the Board of Directors has more than 5% interest.
 

Significant Shareholders: natural or legal persons that, directly or indirectly, alone or in association, controls 5% or more of the Company's shareholding.

Executive Board Member: a member of the Board of Directors who is also a member of the executive management of the company and participates in the daily affairs of the company and earns a monthly salary in return thereof.

Non-executive Board Member: a member of the Board who provides opinions and technical advice and is not involved in any way in the management of the company and does not receive a monthly or an annual salary.

Independent Board Member: a member of the Board who enjoys complete independence. This means that the member is fully independent from management and the company. Independence is the ability to judge things after taking into account all relevant information without undue influence from management or from other external entities.

Independence cannot be attained by a Board member in the following situations, including but not limited to:

a) Being a Significant Shareholder in the Company, or in a Related Company, working for or representing a Significant Shareholder

b) Being a member of the Board in a Related Company or one of its subsidiaries, or having been one during the past two years
 

c) Being a member of the Board of the Company for more than nine years

d) Holding a Senior Management position in the Company, or in a Related Company, or having held one during the past two years

e) Being an employee with the Company, with a Related Company, or with a company that provides services to the Company (e.g., external auditors, consulting firms, etc.) or having worked with any one of the above during the past two (2) years

f) Being a Related Person of a member of the Board or Senior Management of the Company or of a Related Company

g) Having a contractual or business relationship with the Company (either directly or through an entity in which he or she is a Significant Shareholder, a Board member, or a manager) which resulted in paying to, or receiving from, the Company the equivalent of two hundred and fifty thousand (250,000) Saudi riyal or more (other than his or her remuneration as a director of the Board and amounts related to insurance contracts) during the past two (2) years

h) Being under any financial obligation towards the Company or any members of its Board or Senior Management that might limit the exercise of independence in judgment and decision making
 

Senior Management (Management): the

Managing Director, Chief Executive Officer, General Manager, their deputies, Chief Financial Officer, Managers of key departments, officers of risk management, internal audit, and compliance functions, and similar positions in the Financial Institution, in addition to incumbents of any other positions determined by SAMA.

Senior Positions: Members of the board and senior management.

Stakeholders: the persons or parties who have an interest in the company, including shareholders, policyholders, claimants, employees, reinsurers, regulatory and supervisory bodies.

The rest of the words and statements used in this Regulation shall have the same meaning as per Article (1) of the Implementing Regulations of the Law on Supervision of Cooperative Insurance Companies unless the context requires otherwise.