Navigating the QFMA 2025 Governance Code: What Listed Companies Need to Know

Introduction: A New Era for Governance in Qatar

The Qatar Financial Markets Authority (QFMA) has introduced a sweeping update to its corporate governance framework with the release of the 2025 Governance Code for Listed Companies. This new Code replaces the 2016 Governance Code for Companies and Legal Entities Listed on the Main Market, aligning Qatar’s capital markets with global best practices and reflecting the nation’s ambition to strengthen transparency, accountability, and investor confidence.

For listed companies, the implications are immediate and far-reaching. Boards must act quickly: the Code came into force upon publication in the Official Gazette, with a one-year grace period (until August 2026) to achieve compliance. Extensions may be possible, but the regulator’s message is clear—governance standards are rising, and companies must keep pace.

In this article, we unpack the new obligations introduced by the 2025 Code, explore what they mean in practice for boards and management, and outline how companies can prepare for compliance. We also share LAMAH’s perspective on how this transition creates opportunities not just for compliance, but for stronger governance and long-term value creation.

Why the Governance Code Matters

Corporate governance is more than a regulatory checkbox. It is the framework by which companies are directed, controlled, and held accountable. Strong governance builds trust with investors, ensures fairness for all shareholders, strengthens internal controls, and enables sustainable performance.

The 2016 Code established important foundations in Qatar. But global expectations have shifted significantly since then—particularly around board independence, diversity of expertise, insider controls, and environmental, social, and governance (ESG) reporting. The 2025 Code reflects these shifts, drawing on international standards such as the OECD Principles of Corporate Governance and the ISSB’s sustainability disclosure frameworks.

For boards and executives, the new Code raises both the standard and the stakes. Compliance is mandatory, but so is demonstrating governance maturity to the market.

Key New Obligations for Listed Companies

1. Board Restructuring

The Code requires all listed companies to maintain a board of directors with no fewer than seven and no more than eleven members.

• Implication: Companies with smaller boards (e.g., five or six directors) must amend their Articles of Association and appoint additional directors. Those with more than eleven directors must plan a reduction, typically by not re-nominating certain members at the next Annual General Assembly.
• Action required: Amend company bylaws, secure shareholder approval at an EGM if necessary, and plan succession early to avoid rushed decisions.

2. Increasing Independent Representation

Every board must now include at least three independent directors. The definition of “independent” has also tightened considerably:

• Candidates and their immediate families must not hold significant shareholdings.
• They must not have recent employment or consulting ties to the company or its affiliates.
• No close family relationships are permitted with existing board members or senior executives.
• Independent directors may serve for a maximum of two consecutive terms, ensuring regular board refreshment.
• Implication: Boards that previously satisfied the “one-third independent” rule may still fall short under the new criteria. Many will need to identify and recruit new qualified independents, particularly those with expertise in finance, business, or governance.
• Action required: Update independence affidavits and vetting processes. Begin succession planning now to avoid last-minute compliance issues in 2026.

3. Revise Nomination & Election Policies

The Code introduces a more rigorous framework for board nominations and elections, including:

• Cumulative voting, which strengthens the ability of minority shareholders to secure representation.
• Detailed nomination and election procedures, from announcing the nomination period to submitting candidate lists to QFMA two weeks before the AGM.
• Expanded responsibilities for the Nomination & Remuneration Committee, which now plays a central role in vetting candidates and overseeing the process.
• Implication: Companies must formalize their nomination policies and election procedures in line with the new Code. Minority shareholder and even employee representation must be considered.
• Action required: Revise the “Board Nomination and Election Policy” and ensure committees are prepared to manage the process transparently.

4. Committee Formation and Charters

Audit, Nomination, and Remuneration Committees are explicitly required. Their responsibilities are broader than before:

• The Audit Committee must be chaired by an independent director and have a majority of independent members.
• The Nomination & Remuneration Committee must oversee director training, succession planning, and performance evaluation.
• The Board Chair is prohibited from serving on any committee.
• Implication: Companies will need to review committee membership and reconstitute where necessary. Charters must be updated to reflect the expanded duties.
• Action required: Draft new or revised committee charters, confirm membership alignment, and communicate changes to shareholders.

5. Insider Trading Compliance

The Code broadens the definition of Insider to include:

• All board committee members, even if they are not directors.
• Spouses and minor children of all insiders.

Companies must:

• Maintain updated insider lists.
• Pre-clear and monitor insider transactions.
• Enforce blackout periods.
• Report insider trades promptly to QFMA, the exchange, and the depository.
• Implication: Insider compliance programs must expand to cover a wider group and stricter disclosure requirements.
• Action required: Update insider trading policies, train new insiders (particularly committee members), and establish systems for timely reporting.

6. ESG and Sustainability Reporting

Perhaps the most transformative change: all listed companies must publish an annual sustainability report. This must outline:

• Environmental impact and initiatives.
• Social contributions and workforce engagement.
• Governance practices and performance.

The QFMA will issue guidance aligned with international standards (e.g., ISSB, GRI).

• Implication: ESG reporting is no longer optional or reputational—it is regulatory. Many companies will need to develop entirely new processes to gather data and produce reports.
• Action required: Establish ESG governance frameworks, identify relevant metrics, and prepare the first sustainability report for inclusion in the next annual reporting cycle.

7. Disclosure Policy and Annual Governance Reporting

The Code mandates a formal Disclosure and Transparency Policy, approved by the board, covering all aspects of disclosure—from financial results to ESG performance.

• The annual Corporate Governance Report must confirm compliance with the 2025 Code, explain any deviations (under the “comply or explain” principle for Venture Market companies), and include ESG reporting highlights.
• Implication: Companies must enhance their internal reporting and disclosure processes to ensure accuracy, timeliness, and consistency.
• Action required: Draft and adopt a comprehensive Disclosure Policy, integrate ESG disclosures, and expand governance report content accordingly.

8. Government Ownership Considerations

The Code addresses companies with significant government ownership or board representatives. While some exceptions apply (such as limits on board memberships), the expectation is clear: these companies must uphold the same governance standards as private peers, with heightened transparency.

• Implication: Government-linked companies may face unique challenges in aligning with independence and committee requirements.
• Action required: Coordinate early with government stakeholders to ensure compliance with the Code’s requirements.

Preparing for Compliance: Practical Steps

With less than a year to comply, listed companies should:

1. Conduct a governance gap analysis – Benchmark current structures, policies, and practices against the 2025 Code.
2. Amend Articles of Association – Update board size and election provisions where necessary.
3. Restructure boards and committees – Recruit new independents, rotate out long-serving directors, and reconstitute committees.
4. Revise governance policies – Update charters, insider trading policies, disclosure policies, and nomination procedures.
5. Prepare ESG reporting capabilities – Establish data collection, select reporting frameworks, and draft the first sustainability report.
6. Train boards and insiders – Ensure directors and executives understand their new obligations.

LAMAH’s Perspective: From Compliance to Opportunity

At LAMAH, we view the 2025 Governance Code not just as a compliance challenge, but as an opportunity for listed companies to strengthen their governance foundations and build investor confidence. Strong governance attracts capital, enhances reputation, and enables sustainable growth.

To support boards and management teams, we have developed two fast-track offerings:

2025 Code Readiness Audit

A structured, evidence-based review of your governance framework against every new requirement of the Code. We provide a gap analysis, remediation roadmap, draft policy updates, and practical tools such as board skills matrices and insider checklists.

Governance Compliance Package (Retainer)

Hands-on implementation support to execute the roadmap. We partner with your board and company secretary to update policies, reconstitute committees, manage nomination cycles, operationalize insider compliance, and prepare the Governance and Sustainability Reports. Delivered on a retainer basis, this ensures ongoing compliance and peace of mind.

Conclusion: The Time to Act is Now

The QFMA’s 2025 Governance Code sets a higher bar for governance in Qatar’s listed companies. Boards must move quickly to restructure, recruit, revise, and report. The one-year compliance window is short, and the workload is substantial.

But with the right support, companies can not only comply but also seize this moment to enhance their governance, strengthen investor confidence, and align with global best practices.

At LAMAH, we are committed to guiding our clients through this transition—turning regulatory change into strategic advantage.

Read the QFMA 2025 Governance Code, Arabic Version, on the QFMA website

Read the QFMA 2025 Governance Code, English Version, on the QFMA website