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Benefits of corporate governance to small businesses highlighted
By our business bureau February 12, 2019
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SHARJAH/MUSCAT: Pearl Initiative, a Gulf business–led organisation promoting corporate culture of accountability and transparency as a driver of competitiveness and sustainable economic growth across the Middle East, held a special dialogue session in collaboration with Zubair Small Enterprises Centre (Zubair SEC) to address how corporate governance practices can help micro, small and medium enterprises (MSMEs) navigate growing economic challenges and boost business outcomes.

The session was organised as part of Zubair SEC’s “Tajribati” monthly dialogue initiative, which hosts a number of prominent speakers and experts in governance and MSMEs in the Sultanate and participating MSMEs at Bait Al Zubair. This is the second time Pearl Initiative, a business-led non-profit advocating corporate accountability in the Gulf region, has run governance-related sessions with Zubair SEC.

The event, titled “Governance for Sustainable Growth: Enhancing MSME Outcomes”, highlighted the key role corporate governance practices can play in boosting the profiles of small businesses by making them more appealing to stakeholders, such as investors.

Gulf Region MSMEs are the backbone of national economies and employ significant proportions of local labour forces. However, they face unique challenges that hinder their growth plans, such as a lack of funding or difficulties hiring specialised talent. Corporate governance, when applied well, can streamline a small business and help it reach its full potential – and can assure external stakeholders of its drive for success.

This event builds on research undertaken in 2017 by the Pearl Initiative on the state of corporate governance in Gulf Region MSMEs (micro, small and medium enterprises). It revealed that while 83 per cent of Omani MSMEs wished to grow in the next one to two years, 51 per cent of them faced an absence of cash and funding. 48 per cent of Omani small businesses also highlighted difficulties that they faced in hiring and retaining skilled talent. Such challenges can be effectively tackled by businesses of all sizes with knowledge of corporate governance and the implementation of its related practices.

The dialogue session featured experts in corporate governance from the SME, banking, academic, and policy fields in Oman. Participants interacted with these experts to learn about the value that good governance can bring to their enterprises. The expert speakers were Sayyid Hamid Al Busaidi, Executive Director at the Oman Center for Governance and Sustainability; Faris Al-Harthy, Project Specialist at Sharakah; and Jamal Al-Wahaibi, Head of SME Department, Oman Arab Bank. The expert moderator was Dr. Munther Al-Busaidi, Assistant Professor, Sultan Qaboos University.

Sayyid Hamid Al Busaidi stated, “Corporate governance is an essential element and very much needed in a financial business environment specifically, and for the Omani economy in general. SMEs are seen as one of the important pillars in driving the Omani economy to grow and sustain Oman’s 2040 Vision. Therefore, corporate governance will support these enterprises to grow, sustain and contribute effectively in the Omani economy.”

Participants also had the chance to engage with these experts on how to achieve diversity in their organisations, manage risk, operate transparently, and strengthen internal communication processes – qualities that mirror the values and culture of a business.

Yasmine Omari, Executive Director at the Pearl Initiative, said, “The Pearl Initiative is consistently at the forefront of promoting a culture of corporate governance, accountability and transparency in the Gulf Region. Our engagement with MSMEs on this front is crucial when considering the vital role these businesses play in boosting national and regional economies. A strong MSME sector – fuelled by stringent corporate governance practices – will contribute to stronger economies, markets and overall development.”

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