Document background
A Directors Service Agreement is a crucial document used when appointing new members to a company's board of directors in Saudi Arabia. This agreement serves as the primary contract between the company and its directors, whether executive or non-executive, establishing their rights, duties, and obligations. The document must comply with Saudi Companies Law, Capital Market Authority regulations (for listed companies), and Shariah principles, while incorporating international corporate governance best practices. It is particularly important in the Saudi context due to the ongoing economic reforms under Vision 2030, which emphasize improved corporate governance and transparency. The agreement typically covers comprehensive details about the appointment, including remuneration, time commitment, confidentiality obligations, and termination provisions, while ensuring alignment with both local regulatory requirements and the company's constitutional documents.
