Code of Business Ethics (UAE)

A Code of Business Ethics in the United Arab Emirates is a formal governance document that sets out the ethical values, principles, and standards that an organisation expects all its directors, managers, employees, contractors, and agents to uphold in all business activities. The Code translates the company's commitment to ethical conduct into practical standards covering integrity, conflicts of interest, anti-bribery, confidentiality, fair competition, and respect for all persons.

In the UAE legal framework, a Code of Business Ethics is grounded in the fiduciary duties imposed on directors by the Commercial Companies Law — Federal Decree-Law No. 32 of 2021 — including the duty of loyalty (Article 22), the duty of care (Article 23), the prohibition on self-dealing (Article 24), and the obligation to disclose conflicts of interest (Article 25). The Commercial Companies Law imposes personal liability on directors for losses suffered by the company as a result of breach of these duties, and the UAE Penal Code Federal Decree-Law No. 31 of 2021 provides for criminal sanctions in serious cases of corporate misconduct.

A Code of Business Ethics is also central to compliance with multiple other UAE laws. The anti-bribery and anti-corruption elements connect to the UAE Penal Code and the Anti-Money Laundering and Combating the Financing of Terrorism Law Federal Decree-Law No. 20 of 2018. The confidentiality and data protection elements connect to the Personal Data Protection Law Federal Decree-Law No. 45 of 2021. The fair competition elements connect to the UAE Competition Law Federal Law No. 4 of 2012 as amended by Federal Decree-Law No. 26 of 2023. The workplace respect and non-discrimination elements connect to UAE Labour Law Federal Decree-Law No. 33 of 2021.

For listed companies on the Abu Dhabi Securities Exchange (ADX) or Dubai Financial Market (DFM), the Securities and Commodities Authority Corporate Governance Code requires a board-level code of ethics and specific disclosures on governance practices. For companies based in the Dubai International Financial Centre, the DIFC Employment Law and the DIFC Code of Business Conduct set additional standards. For ADGM entities, the ADGM Corporate Governance Regulations impose equivalent requirements.

Beyond legal compliance, a Code of Business Ethics builds the trust and reputation that enables long-term commercial success. UAE businesses that demonstrate consistent ethical conduct in their dealings with government authorities — including the Ministry of Economy, MOHRE, and the Federal Tax Authority — and with private counterparties benefit from stronger relationships, more reliable partnerships, and a competitive advantage in markets where ethical supply chain management is increasingly a procurement criterion.

The forms-legal.com Code of Business Ethics (UAE) template provides a complete, values-based framework covering all core ethical obligations under UAE law, available in PDF and Word format for immediate adoption.

A Code of Business Ethics is needed for UAE companies in the following circumstances.

All companies listed on the ADX or DFM are required by the SCA Corporate Governance Code to adopt a board-level code of ethics setting out the ethical standards expected of directors, officers, and employees. Non-compliance with the SCA Corporate Governance Code requires a formal 'comply or explain' disclosure in the annual report.

Companies regulated by the Central Bank of the UAE — banks, finance companies, and insurance companies — are required by the Central Bank's corporate governance standards to have a code of ethics covering conflicts of interest, confidentiality, anti-corruption, and customer protection.

DNFBPs regulated by the Ministry of Economy for AML purposes benefit from having a Code of Business Ethics as part of their broader compliance framework, demonstrating to regulatory inspectors that ethics and compliance culture are embedded at all levels of the organisation.

Large privately held groups and family businesses in the UAE — particularly those with multiple shareholders and complex management structures — should adopt a Code of Business Ethics as part of their corporate governance framework, to establish clear expectations for all members of the management team and to set standards that protect the company from reputational and legal risk.

Any UAE company tendering for government contracts, participating in regulated procurement, or seeking access to capital markets through bank financing or green bonds benefits from demonstrating a governance framework that includes a Code of Business Ethics. Government and corporate counterparties conducting due diligence increasingly review ethics and compliance policies as part of Know Your Customer and supplier qualification processes.

Companies that expand internationally — establishing branches or subsidiaries in other countries, or entering joint ventures with international partners — typically need to demonstrate that their ethics programme meets the standards expected in those jurisdictions, including UK Bribery Act 2010 'adequate procedures' requirements.

A complete UAE Code of Business Ethics must address the following elements to provide meaningful governance guidance and to satisfy the requirements of the Commercial Companies Law Federal Decree-Law No. 32 of 2021 and regulatory expectations.

Ethical values: A clear statement of the company's core values — integrity, respect, accountability, compliance, and sustainability — and a commitment from the board or general manager that these values are not negotiable. Tone from the top is the most important element: a Code endorsed by the CEO and board carries significantly more weight than one endorsed only by the compliance function.

Conflicts of interest: Specific definitions of what constitutes a conflict of interest in the UAE context — financial interests in competitors or suppliers, family relationships with counterparties, directorship of other entities — and a clear disclosure and management procedure including a conflict of interest register maintained by the Ethics Officer.

Anti-bribery and anti-corruption: A zero-tolerance statement on bribery, facilitation payments, and kickbacks, referencing the UAE Penal Code Federal Decree-Law No. 31 of 2021, with cross-reference to the company's detailed Anti-Bribery Policy.

Confidentiality and data protection: Standards for protecting company confidential information and personal data consistent with the PDPL Federal Decree-Law No. 45 of 2021, with clear consequences for unauthorised disclosure.

Fair competition: A prohibition on anti-competitive conduct — price-fixing, bid-rigging, and market allocation — with a practical explanation of how this affects day-to-day decisions, particularly industry association participation and supplier negotiations.

Accurate records: The obligation to maintain accurate financial and business records in compliance with the Commercial Companies Law Federal Decree-Law No. 32 of 2021.

Reporting and non-retaliation: The ethics reporting channel — accessible by all covered persons — and an explicit non-retaliation guarantee. The forms-legal.com Code of Business Ethics (UAE) template includes all of these elements in a readable, values-based format.

Completing the Code of Business Ethics for a UAE company begins with entering the company's full registered name, the emirate of registration, and the effective date of the Code — typically the board approval date.

Designate the Ethics Officer. Enter the name and title of the person responsible for administering the Code, providing guidance on ethical questions, receiving and investigating concerns, and conducting or arranging ethics training. For most UAE companies, this is the Chief Compliance Officer, General Counsel, or a senior manager with adequate authority and independence. The Ethics Officer must have direct access to the board or general manager, the authority to investigate concerns without interference, and protection from retaliation for carrying out their role. Where the Company has a board audit committee, the Ethics Officer should have a direct reporting line to that committee for serious concerns.

Enter the ethics reporting channel. This should be a specific, monitored email address or confidential hotline — not merely 'speak to your manager' — that all covered persons can use to raise concerns confidentially. The channel should be accessible outside of normal working hours and should provide for anonymous reports where permitted by UAE law and company policy. Consider whether a different channel should be provided for reports involving the Ethics Officer or senior management.

Select the Code review period. Annual review is recommended for regulated entities and for companies with significant compliance risk. The review process should include consultation with the Ethics Officer, a review of concerns raised during the period, and any updates to UAE law or regulatory guidance.

After completing the wizard, arrange for board approval and signature by the CEO and Ethics Officer. Distribute the Code to all covered persons — employees, contractors, and agents — and require signed annual acknowledgements of receipt and compliance. Incorporate ethics training covering the Code's key requirements into the onboarding programme and annual compliance training schedule.

Legal requirements relevant to a UAE Code of Business Ethics arise from multiple sources.

The Commercial Companies Law, Federal Decree-Law No. 32 of 2021, is the primary corporate governance statute. Articles 22 to 28 impose fiduciary duties on directors including loyalty, care, conflict disclosure, prohibition on competing with the company, and prohibition on using company information for personal benefit. Breach of these duties can result in personal liability, disqualification from directorship, and in serious cases criminal prosecution under the UAE Penal Code.

The UAE Penal Code, Federal Decree-Law No. 31 of 2021, provides criminal sanctions for bribery, fraud, breach of trust, disclosure of business secrets, and other forms of corporate misconduct. Directors and senior officers can be personally prosecuted for conduct that harms the company, its shareholders, or third parties.

The UAE Labour Law, Federal Decree-Law No. 33 of 2021, requires employment contracts to specify the obligations of employees and the consequences of breach. A Code of Business Ethics incorporated by reference into employment contracts creates enforceable obligations and provides the legal basis for disciplinary action for ethical breaches under the Labour Law.

For listed companies, the SCA Corporate Governance Code requires a written code of ethics, specific board-level ethics procedures, and 'comply or explain' disclosures in the annual report. The ADX and DFM listing rules include governance requirements aligned with the SCA Code. For DIFC entities, the DIFC Employment Law and DIFC Whistleblower Protection Law 2022 impose specific non-retaliation obligations. For ADGM entities, the ADGM Corporate Governance Regulations 2020 set equivalent standards.

The UAE Competition Law, Federal Law No. 4 of 2012 as amended by Federal Decree-Law No. 26 of 2023, prohibits anti-competitive agreements and abuse of dominance. A Code of Business Ethics that addresses fair competition obligations supports the company's compliance with this law. The Ministry of Economy enforces the competition law and can impose fines up to 10% of annual revenues.

Common mistakes in UAE Codes of Business Ethics include the following.

Drafting a Code that is aspirational but unenforceable — full of values statements but lacking specific standards, examples, and consequences for breach — produces a document that provides no practical guidance and no legal protection. A Code of Business Ethics must be specific enough that covered persons know what is and is not acceptable, and the consequences of breach must be clear: disciplinary action under the UAE Labour Law Federal Decree-Law No. 33 of 2021, up to and including dismissal for serious violations.

Omitting the ethics reporting channel or making it inaccessible and impractical is a fundamental design failure. A Code that tells employees to report concerns 'to their manager' provides no protection for employees whose concern involves their manager. The reporting channel must be independent of line management, accessible confidentially, and clearly communicated. The absence of a functional reporting channel is typically the reason that ethics problems escalate undetected until they become serious incidents.

Failing to provide ethics training that connects the Code's requirements to day-to-day situations in the company's actual business is another common failure. Generic ethics training that talks abstractly about integrity without illustrating what conflicts of interest, bribery solicitations, and competitive information misuse look like in the context of the company's own industry and operations does not change behaviour. Effective training uses realistic scenarios relevant to the company's activities.

Not requiring annual ethics acknowledgements from all covered persons — directors, senior managers, employees, and agents — means that the company has no record of who has received and agreed to the Code, and no mechanism for ensuring that conflicts of interest are formally disclosed. Annual acknowledgements also provide an opportunity for covered persons to disclose any existing conflicts, which the Ethics Officer can then manage proactively.