Corporate governance and insolvency are closely linked. As acknowledged by the OECD Principles of Corporate Governance, the corporate governance framework should be complemented by an effective, efficient insolvency framework and by effective enforcement of creditor rights. Companies with a good corporate governance record reduce the risks of lenders and are often able to borrow more and on more favourable terms than their competitors with a poor governance record. Moreover, corporate governance in insolvent enterprises poses specific challenges. Legal frameworks often impose on directors of insolvent enterprises to act in the interests of creditors, and provide the latter with specific role in the governance of distressed debtors.
In order to take stock of the existing MENA frameworks and practices, raise awareness on existing international guidance on insolvency and establish a network of regional insolvency experts, the OECD and Hawkamah organised a meeting on Developing Sound Insolvency and Creditor Right Systems in the MENA. In doing this, the OECD and Hawkamah explored avenues for co-operation with its international and regional partners. The input of the private sector was sought in co-operation with INSOL International, the international organization of insolvency professionals.