Step‑by‑step Guide to the Corporate Governance Process in Palestine, 2026 Update

The corporate governance process in Palestine 2026 requires companies, banks and public institutions to complete a defined sequence of board appointments, policy adoptions, regulator filings and independent verifications. The process affects every public shareholding company supervised by the Palestine Capital Market Authority (PCMA), every bank regulated by the Palestine Monetary Authority (PMA), and, since the PMO‑approved Governance Framework for Non‑Ministerial Public Institutions (2025–2026), state‑owned enterprises and public‑sector bodies as well. This guide translates current policy announcements into the operational steps, documents, timelines and cost estimates that corporate counsel, CFOs and company directors need to implement or audit governance arrangements in Palestine during 2026.

Overview of the Process and Who It Applies To

Corporate governance in Palestine is not a single filing. It is a structured, multi‑phase process that runs from board formation through to independent verification. The discrete stages are:

1. Board formation and director appointment
2. Establishment of board committees and adoption of charters
3. Drafting and approval of internal control policies
4. Disclosures, regulator filings and public reporting
5. Independent verification and audit

Four regulators and registries share oversight. The PCMA sets and enforces the corporate governance code for public shareholding companies listed or operating in the Palestinian capital market. The PMA issues governance guidance for banks and financial institutions, including requirements for committee composition and risk management. The Prime Ministry (PMO) has extended governance obligations to non‑ministerial public institutions under its 2025–2026 framework. The Ministry of National Economy operates the Companies Registry, through which all director changes and articles‑of‑association amendments are formally recorded.

Private companies are not subject to the PCMA Code, but industry observers expect that lenders, donors and international partners increasingly require private firms, particularly those receiving foreign investment, to adopt governance structures aligned with the Code or with AMAN’s Code of Corporate Governance recommendations.

Eligibility and Prerequisites, Corporate Governance Requirements in Palestine

Which companies are covered

The mandatory scope of the corporate governance process in Palestine in 2026 breaks down into four categories:

• Public shareholding companies. Subject to the PCMA corporate governance code. This includes listed companies and public shareholding companies that have offered shares to the public. The PCMA Code prescribes board composition, committee structures, disclosure requirements and related‑party transaction controls.
• Banks and financial institutions. Regulated by the PMA. The PMA’s corporate governance guide for banks mandates specific committee compositions (audit, risk, compliance, nomination and remuneration), fit‑and‑proper requirements for directors, and enhanced risk‑management frameworks.
• State‑owned enterprises and non‑ministerial public institutions. Covered by the PMO Governance Framework (2025–2026). These entities must restructure their boards, adopt performance frameworks and align reporting with the PMO’s governance standards.
• Private companies. Not formally subject to the PCMA Code but may be contractually required to adopt governance measures by investors, lenders or international partners. The AMAN Code of Corporate Governance provides a voluntary but widely referenced standard.

Before beginning the process, every company should hold up‑to‑date copies of its articles of association, shareholder register, existing board minutes and any prior filings with the Companies Registry.

Foreign investor eligibility and practical considerations

Foreign investors may serve as directors or shareholders, subject to any sector‑specific restrictions and licensing requirements administered by the Ministry of National Economy. Practical considerations for foreign directors include document legalisation (apostille or consular attestation), certified Arabic translations of identification and professional credentials, and, in some sectors, the appointment of a local registered agent. Early collection and preparation of these documents prevents delays at the filing stage.

Step‑by‑Step Corporate Governance Process in Palestine 2026

The following five steps form the core of the board appointment process in Palestine and the broader governance implementation cycle. Each step is presented with its sub‑actions, responsible parties and indicative timeframes.

Step 1, Board formation and appointment

1. Issue notice of general meeting. The company secretary or legal counsel prepares and dispatches a notice convening the general meeting at which directors will be appointed or replaced. The notice must comply with the statutory notice period prescribed by the applicable companies legislation and the company’s own articles of association. Failure to meet the notice period is one of the most common procedural defects.
2. Hold the shareholder resolution. At the general meeting, shareholders vote on the appointment, re‑appointment or removal of directors. Minutes must be drafted, signed and retained. If the company is a public shareholding entity, quorum and voting thresholds set by the PCMA Code apply.
3. Prepare director consents and declarations. Each incoming director completes and signs a consent‑to‑act form, a fit‑and‑proper declaration, a conflicts‑of‑interest disclosure and a declaration of other directorships. For regulated entities (banks, listed companies), the PCMA or PMA may require additional documentation, including a detailed CV and a copy of the director’s identification or passport.
4. File the director appointment with the Companies Registry. The company secretary submits the updated list of directors and the signed shareholder resolution to the Companies Registry at the Ministry of National Economy. Filing should occur within the statutory filing window after the resolution date. Retain the registrar’s receipt or acknowledgement as proof of filing.
5. File with the PCMA or PMA (where applicable). Public shareholding companies must notify the PCMA of board changes. Banks must notify the PMA. Each regulator may require its own forms and supporting documentation.
6. Publish the appointment. Depending on the company type, publication may be required on the company’s website, in a local newspaper or in the official gazette. SOEs subject to the PMO framework may have additional publication obligations.

Step 2, Establish board committees and charters

1. Identify required committees. At a minimum, the PCMA Code expects public shareholding companies to establish an audit committee. Best practice, and the PMA’s bank governance guide, calls for audit, risk, nomination and remuneration committees.
2. Draft committee charters. Each charter should define the committee’s mandate, membership criteria (including independence requirements), quorum rules, meeting frequency and reporting obligations to the full board. Corporate counsel typically drafts these charters in consultation with the board chair.
3. Appoint committee members. The board formally assigns directors to each committee. For banks, the PMA guidance specifies composition requirements, for example, the audit committee should include members with financial expertise, and the majority should be non‑executive or independent directors.
4. Hold and minute the first committee meeting. Each committee convenes its inaugural meeting, reviews its charter, and records minutes. These minutes form part of the governance documentation trail.

Step 3, Internal policies and control frameworks

1. Draft core governance policies. The board, supported by management, legal counsel and HR, prepares policies covering conflict of interest, related‑party transactions (RPTs), whistleblowing and grievance channels, risk management and internal controls. The AMAN Code of Corporate Governance provides a useful template framework.
2. Board approval. Each policy is tabled, discussed and formally approved by the board. The approval should be recorded in board minutes with a clear resolution reference.
3. Communicate policies to management and staff. Approved policies must be distributed to all relevant personnel. Evidence of communication, such as signed acknowledgements, intranet postings or training attendance registers, should be retained.
4. Implement training. Directors and senior management should receive governance training, particularly on RPT identification and whistleblower protection. For banks, the PMA may expect periodic refresher training. Retain training materials and attendance records.

Step 4, Disclosures, regulator filings and public reporting

1. Prepare the annual corporate governance report. The company secretary, in coordination with the external auditor, compiles the annual governance report. For public shareholding companies, the format and content are guided by PCMA disclosure requirements. The report typically covers board composition, committee activities, RPTs, risk‑management outcomes and any deviations from the applicable code.
2. File with the relevant regulator. Public shareholding companies submit the report to the PCMA. Banks submit governance‑related disclosures to the PMA. SOEs file with the PMO or the relevant line ministry.
3. Update the Companies Registry. Any changes to the articles of association, director register or registered office must be filed with the Ministry of National Economy.
4. Publish disclosures. Listed companies publish governance reports on their websites and, where required, in official publications. The disclosure requirements in Palestine mandate that material information be made accessible to shareholders and the public in a timely manner.

Step 5, Independent verification and audit

1. Engage an external auditor. The board (via the audit committee) engages a licensed external auditor to review the company’s financial statements and, where required, its governance compliance. The auditor engagement letter should define the scope of the governance review.
2. Conduct an internal audit. Larger companies and banks should maintain an internal audit function, either in‑house or outsourced, that tests compliance with approved policies and reports to the audit committee.
3. Prepare for regulator inspections. The PCMA and PMA conduct periodic inspections of regulated entities. Companies should maintain a compliance file containing all governance documents, board and committee minutes, policy acknowledgements, training records, filing receipts and publication evidence.
4. Obtain a compliance sign‑off. The board or audit committee issues a formal sign‑off confirming that the governance framework has been implemented in accordance with the applicable code. This sign‑off is typically included in the annual governance report.

Documents Needed for Corporate Governance in Palestine, Checklist

The table below consolidates every document a company should prepare or obtain during the governance checklist for Palestine. Maintaining a complete, auditable file of these documents is essential for regulator filings and inspections.

Compliance Timeline Palestine, Key Deadlines and Implementation Phases

The compliance timeline for Palestine governance implementation typically spans 10 to 30 weeks from initial preparation to external verification, depending on company size and regulatory category. The table below sets out indicative phase durations.

Three common points of delay recur across most implementations:

• Notice‑period irregularities. Late or defective general‑meeting notices invalidate the resulting resolutions. Mitigation: use standard notice templates and calendar the statutory period from the outset.
• Missing foreign‑director documentation. Legalisation, apostille or certified translation requirements are frequently underestimated. Mitigation: begin document collection immediately upon identifying a foreign director candidate.
• Registrar backlog or filing rejections. The Companies Registry may reject filings for minor defects. Mitigation: pre‑check every filing with counsel and keep copies of all receipts and correspondence.

Compliance Costs Palestine, Fees and Tax Considerations

The table below provides indicative cost ranges for the major items in a governance implementation. All figures are estimates and should be verified with the relevant filing office or service provider before budgeting.

Director fees, share options and any benefit‑in‑kind arrangements may trigger Palestinian payroll or withholding‑tax obligations. Companies should review the tax treatment of board compensation with a local tax adviser before finalising director remuneration packages.

What Changes in 2026, Policy and Institutional Developments

Several concrete policy signals in 2025–2026 are reshaping the corporate governance process in Palestine. Companies should map each development to specific internal actions:

• PMO Governance Framework for Non‑Ministerial Public Institutions (2025–2026). The Palestinian government advanced key measures to strengthen governance and rule of law, including a governance framework that requires non‑ministerial public institutions and SOEs to restructure boards, adopt performance‑evaluation criteria and report against defined governance standards. Affected entities should review board composition and begin drafting the required policies immediately.
• PCMA Code updates. The PCMA continues to develop its corporate governance code for public shareholding companies. Companies subject to the Code should monitor the PCMA corporate governance portal for updated templates, disclosure requirements and compliance circulars that may introduce new or amended obligations in 2026.
• PMA bank governance guide. The PMA has issued a guide to corporate governance for banks, setting out rules and best practices covering committee composition (audit, risk, compliance, nomination and remuneration), risk‑management frameworks and director‑fitness requirements. Banks that have not yet aligned their committee structures with the PMA guide should treat this as a priority action.
• Institutional adoption, Bank of Palestine. Bank of Palestine has publicly announced the adoption of enhanced governance and risk‑management policies. Early indications suggest that other banks and large corporates are following suit, signalling that governance implementation is becoming a market expectation rather than a purely regulatory one.
• Civil‑society standards, AMAN Code. The AMAN Coalition for Integrity and Accountability’s Code of Corporate Governance continues to serve as a widely referenced voluntary standard. Private companies and NGOs without a mandatory code often adopt the AMAN framework as a benchmark.

Academic research, including studies from An‑Najah National University (2026) and the Palestinian Economic Policy Research Institute (MAS), has highlighted the positive relationship between robust board characteristics, ownership transparency and firm performance, reinforcing the business case for governance compliance alongside the regulatory imperative.

Common Pitfalls and How to Avoid Them

• Incomplete director declarations. Omitting conflict‑of‑interest or other‑directorship disclosures. Avoid by using a standardised declaration template and cross‑checking before filing.
• Failure to meet notice periods. Dispatching general‑meeting notices late, which invalidates resolutions. Avoid by calendaring the statutory notice deadline at the start of the process.
• Mismatch between charters and articles of association. Board or committee charters that conflict with the company’s AoA create legal uncertainty. Avoid by reviewing and, if necessary, amending the AoA before adopting new charters.
• Inadequate related‑party transaction controls. Failing to define materiality thresholds, approval workflows or disclosure triggers. Avoid by drafting an RPT policy that mirrors PCMA or AMAN requirements.
• Missing filing or publication receipts. Losing proof of submission to the Companies Registry or regulator. Avoid by maintaining a dedicated governance filing log with scanned receipts and date stamps.
• Ignoring PMA bank‑specific guidance. Banks applying only the PCMA Code without addressing PMA‑specific committee and risk‑management requirements. Avoid by reviewing both sets of guidance and mapping overlaps and additions.
• Insufficient evidence of training. Regulators may request proof that directors and staff received governance training. Avoid by retaining attendance registers, training materials and post‑training assessments.
• Weak whistleblower protections. A policy that exists on paper but lacks a protected reporting channel or anti‑retaliation provisions. Avoid by designating a confidential reporting channel and documenting anti‑retaliation safeguards.
• Poor committee composition. Appointing executive directors to committees that require independence. Avoid by checking each committee charter’s independence criteria before assigning members.
• Failure to verify foreign director documentation. Submitting unlegalised or untranslated documents, causing registrar rejection. Avoid by beginning legalisation and translation as soon as a foreign director is nominated.

Sources

1. Prime Ministry of the State of Palestine (PMO), Governance Framework announcement (2025–2026)
2. Palestine Capital Market Authority (PCMA), Corporate Governance
3. Palestine Monetary Authority (PMA), Corporate governance guide for banks
4. Bank of Palestine, Governance adoption announcement
5. AMAN (Coalition for Integrity and Accountability), Code of Corporate Governance
6. Palestinian Economic Policy Research Institute (MAS), Publications
7. An‑Najah National University, Board characteristics and ownership structure research (2026)