Saudi Capital Market Authority seeks feedback on disclosure upgrade for listed firms

The Capital Market Authority has called on all interested parties and market participants to provide their feedback on a project aimed at raising disclosure standards within the management discussion and analysis section of the annual board report. The consultation period will last 30 days, ending on 10 Jumada II 1448 (corresponding to November 20, 2026).

The project aims to strengthen governance, transparency, and disclosure practices among listed companies, and to improve the quality of financial and operational information available to shareholders and potential investors. This will help them analyze company performance, business results, and financial positions, allowing for more informed investment decisions.

The initiative involves updating existing regulatory provisions related to financial and operational performance disclosure by consolidating and organizing them into a dedicated section in the annual board report, titled “Discussion and Analysis of Financial, Operational Performance, and Financial Position.” New requirements will also be added to enhance the comprehensiveness and quality of disclosures, making it easier for investors to access, analyze, and compare relevant information.

Key features of the project include setting a minimum content standard for the dedicated section, covering analysis of company performance, business results, financial position, liquidity, and related financial information from audited statements. It also requires explanations for significant changes and their main drivers, as well as a review of trends, factors, and material uncertainties expected to impact the company’s future operations.

The proposed requirements also call for analysis of financial and operational performance during the fiscal year, key performance indicators, and a comparison of liquidity, solvency, financial position, and capital resources with the previous year. This is intended to help investors better understand company performance developments and assess business results.

The project suggests that, where relevant, analysis of key performance indicators should be based on both financial and non-financial metrics, such as profit margins, return on capital or equity, revenue and profit growth rates, operational efficiency indicators, and others, depending on the company’s business nature.

Compliance with these requirements will be mandatory for all companies listed on the main market starting from the first board report issued after the approval of the proposed regulations. For companies listed on the parallel market, the requirements will initially be advisory, becoming mandatory from the first annual board report issued in the year following the adoption of the regulations.

This project is part of broader regulatory efforts by the Authority to empower investors to exercise their rights more effectively and to enhance their participation in general assemblies. The Authority will announce any further regulatory developments once finalized.

The Capital Market Authority stressed that all feedback and comments received from the public will be carefully considered in order to finalize the project to enhance disclosure within the management discussion and analysis section of the annual board report.

Comments can be submitted via the unified electronic platform for public and government feedback, “Istitlaa,” managed by the National Competitiveness Center, during the consultation period at: istitlaa.ncc.gov.sa