UNITED ARAB EMIRATES Law and Practice Contributed by: Francesco Bulleri, Beshoy Mounir, Sultan Bahriddini and Noora Al Doseri, ADG Legal
tems, and placed greater importance on governance reporting and compliance oversight. There was also a 2025 amendment (ie, SCA Board Chairman’s Resolution No 24 of 2025) allowing, under strict conditions , the combination of the roles of board chairman and chief executive officer or company man - ager for public joint stock companies. This is a signifi - cant governance development because the traditional governance position generally favoured separation between board chairmanship and executive manage - ment. Where a combined role is adopted, enhanced safeguards, shareholder approval and disclosure of the rationale and governance impact should be con - sidered. Accordingly, recent developments affect board structures, disclosure and shareholder rights. Listed companies should expect closer scrutiny of board oversight, internal control systems, risk manage - ment frameworks, governance reporting, related- party transactions, market disclosure procedures and shareholder approvals. The governance and management of companies in the UAE broadly follow internationally recognised cor - porate governance structures. The principal bodies involved are: • the shareholders (acting through the general assembly); • the board of directors (or, in certain structures such as LLCs, a sole manager or board of managers); and • the executive management team (including roles such as the general manager, CEO and other sen - ior officers). At the highest level, shareholders exercise ultimate authority over the company, including in relation to fundamental matters such as amendments to the con - stitutional documents, appointment and removal of directors, approval of financial statements, and deci - sions affecting the company’s capital or existence. 2. Corporate Management 2.1 Principal Bodies or Functions
The board of directors is responsible for the overall management and strategic direction of the company, subject to any matters reserved to the shareholders under applicable law or the company’s constitutional documents. The board typically retains responsibility for governance, oversight and key decision-making, while delegating day-to-day operational matters to executive management. Executive management, led by the general manager or CEO, is responsible for the day-to-day operation of the business and implementation of the strategy set by the board. Their authority is usually derived from board resolutions, powers of attorney or the compa - ny’s constitutional documents. In practice, there is a degree of flexibility in how pow - ers are allocated and exercised. Decision-making authority is commonly delegated downwards (for example, from shareholders to the board, and from the board to management), while certain matters may be escalated upwards where required (for example, in cases of deadlock at board level or where reserved matters require shareholder approval). The precise allocation of powers will depend on the company’s legal form (eg, mainland LLC, joint stock company, or free zone entity such as in the DIFC or ADGM) and its Decision-making authority in UAE companies is typically divided between shareholders (general assembly), the board of directors (or managers) and executive management. The allocation of powers is governed both by law and by the company’s consti - tutional documents (eg, memorandum of association). As a general principle, shareholders retain authority over fundamental and structural matters. These typi - cally include approval of financial statements, dec - laration and distribution of profits, appointment and removal of directors or managers, appointment of auditors, and amendments to the company’s consti - tutional documents. Shareholders also approve major corporate actions such as changes to the company’s capital, mergers, dissolution or liquidation. In joint ventures and other negotiated structures, sharehold - ers frequently agree on a list of “reserved matters” constitutional arrangements. 2.2 Types of Decisions
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