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A Director Services Agreement sets out the legal relationship between a company and its board director in Saudi Arabia. It defines the director's duties, compensation, and performance expectations while complying with the Kingdom's Companies Law and Corporate Governance Regulations.

This agreement protects both parties by clearly outlining confidentiality requirements, board meeting attendance, strategic planning responsibilities, and conflict of interest provisions. It's particularly important for listed companies on Tadawul (Saudi Stock Exchange) and helps organizations maintain good corporate governance practices aligned with the Capital Market Authority's guidelines.

Use a Director Services Agreement when appointing new board members or updating terms for existing directors in Saudi companies. This becomes essential when bringing international expertise to your board, as it clearly defines expectations under Saudi law and prevents misunderstandings about roles and responsibilities.

The agreement proves particularly valuable during corporate restructuring, when preparing for IPOs, or after significant changes to the Capital Market Authority's regulations. It helps protect your organization by establishing clear performance metrics, confidentiality obligations, and compensation terms that align with both company objectives and Saudi corporate governance requirements.

• Executive Director Agreement: Detailed terms for full-time directors involved in daily operations, including KPIs and management responsibilities
• Non-Executive Director Agreement: Focuses on oversight duties, board meeting attendance, and strategic guidance without operational involvement
• Independent Director Agreement: Emphasizes independence requirements under CMA regulations, including specific provisions for conflicts of interest
• Foreign Director Agreement: Contains additional provisions for international board members, including translation requirements and jurisdiction clauses
• Committee Chair Agreement: Specialized terms for directors heading board committees, with detailed committee-specific responsibilities

• Board Directors: Sign and comply with the agreement's terms, including attendance, strategic input, and confidentiality obligations
• Company Secretary: Drafts and maintains Director Services Agreements, ensures compliance with CMA regulations
• Legal Counsel: Reviews and customizes agreements to protect company interests and meet Saudi legal requirements
• Shareholders: Benefit from clear governance structures and director accountability measures
• Capital Market Authority: Oversees compliance with corporate governance regulations for listed companies
• Ministry of Commerce: Ensures agreements align with Saudi Companies Law requirements

• Director Details: Gather full legal name, contact information, and any existing board positions or relationships
• Compensation Terms: Define meeting fees, annual retainers, and any performance-based incentives aligned with CMA guidelines
• Role Specifics: Document expected time commitment, committee assignments, and specific responsibilities
• Company Information: Include registration details, board composition, and governance structure
• Compliance Review: Check alignment with Saudi Companies Law and CMA regulations
• Documentation: Prepare board resolutions approving appointment and agreement terms
• Final Check: Verify all mandatory clauses and formatting meet local legal requirements

• Identification Section: Full legal names of director and company, commercial registration details
• Appointment Terms: Duration, position title, board committee assignments per CMA regulations
• Duties and Powers: Specific responsibilities, authority limits, strategic oversight requirements
• Compensation Structure: Meeting fees, annual retainers, benefits aligned with Saudi labor laws
• Confidentiality Provisions: Protection of company secrets, insider trading restrictions
• Conflict Resolution: Dispute resolution process, applicable Saudi courts jurisdiction
• Termination Clauses: Conditions for ending the agreement, notice periods, exit procedures
• Governing Law: Express reference to Saudi Companies Law and CMA regulations

While similar in name, a Director Services Agreement differs significantly from a Director Appointment Agreement. Let's explore the key distinctions to help you choose the right document for your needs.

• Scope and Detail: A Director Services Agreement is more comprehensive, covering ongoing duties, compensation, and performance metrics, while a Director Appointment Agreement primarily focuses on the formal appointment and basic terms
• Legal Requirements: Director Services Agreements meet CMA's detailed governance requirements for listed companies, whereas Appointment Agreements fulfill basic Companies Law requirements
• Duration Focus: Services Agreements outline long-term relationships and responsibilities, while Appointment Agreements handle the initial appointment process
• Regulatory Compliance: Services Agreements include detailed provisions for conflicts of interest, confidentiality, and strategic responsibilities that exceed basic appointment terms