As part of its efforts to enhance governance and financial sustainability, Oman Investment Authority (OIA) has announced the completion of a project to rationalise compensation and benefits for employees of state-owned enterprises (SOEs).
The project aimed to rationalise salaries, allowances, and benefits in a realistic approach in accordance with the dynamics that Oman’s economy is facing. In addition, the project aimed to enhance financial sustainability through the projected savings from this scheme, taking into account compensation and benefits competitiveness in some sectors. The new scheme will be effective from April 1.
Planning of the project started last year in July, when OIA commissioned Takatuf, one of its subsidiaries, to conduct a comprehensive study of SOEs within three main aspects: Human Resources Policies, Compensation and Benefits, and Organisation Structures.
Takatuf also studied the best practices of governance of those aspects globally for SOEs, which covered a number of member states of the Organisation for Economic Co-operation and Development.
In light of these studies, a regulatory framework has been produced that takes into account introducing an Omani standard of reference that fits within the national economy and puts in consideration the competitiveness of the business environment in the sultanate.
In addition, the new framework links compensation and benefits to the company’s performance and the mandate, while guaranteeing fairness both at the level of the SOEs and economic sectors. The framework was designed to reduce the side effects that may result from this project. The new regulatory framework complies with related legal and administrative requirements.
A number of workshops targetting chairpersons of Boards of Directors, CEOs, and Human Resources heads will accompany the launch of the project in order to familiarise them with the new framework and its implementation mechanisms.
OIA continues to adopt practices and measures to ensure the existence of a comprehensive governance framework for SOEs in order to improve their performance, especially through ‘Rawabet’ programme.
The authority continues to review the organisational and operational structures of holding companies by restructuring, merging and dissolving subsidiary companies in order to maximise their economic and financial returns, and further empowering the private sector in its contribution to the development of Oman.