An investment opportunity reaches a director, whose is it

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A manager may receive an offer to partner, buy an asset or distribute a product because of their company role and consider taking it personally, first establish how it arrived, whose resources assessed it and its connection with company activities, those facts can change both the legal assessment and the business decision.

Establish the company connection

Article 27 of the Companies Law prohibits using company assets, information or opportunities presented to a manager or director in that capacity, or to the company, for direct or indirect personal benefit, record the offer’s source, the capacity in which it was received and the information used, not every personal acquaintance belongs to the company, but placing a project in a relative’s or another entity’s name cannot justify ignoring indirect interests or how access to the opportunity arose.

Distinguish conflict situations

Taking a company opportunity differs from having an interest in its contract or entering a competing activity, these situations can coincide, contractual interests and competition have statutory authorisation routes, misuse of assets, information and opportunities cannot be reduced to general approval or formal disclosure, review the law, regulations and facts before acting, identify the authorised decision maker and the information needed for a useful review.

Ensure independent decision making

Disclose interests and connected parties in writing before a decision and follow applicable participation and voting rules, identify who assessed the opportunity and why it was accepted or rejected, the interested person should not be the sole source for its feasibility or limits, if the company declines it, document reasons and boundaries for using company information and resources, independently review subsequent actions, rejecting one opportunity does not automatically justify using confidential data or company assets.

Set policy before the offer

Set a policy covering gifts, interests, outside activities, offers to management and record retention, establish a disclosure channel and regular interest reviews, train staff to distinguish a customer who knows a director personally from an offer received because of a company role, the assessment requires clear facts, link policy to the authority matrix, contracts and confidentiality agreements so it operates in ordinary business rather than appearing only after a dispute.

• Record the source and receiving capacity
• Disclose direct and indirect interests
• Review authority, regulations and information-use limits

When an offer relates to your company role, start with disclosure and independent assessment, record the applicable decision before making a personal commitment that may create a difficult conflict.

General educational content, not a substitute for advice on your facts and documents, and not a guarantee of any outcome.

Translations refer to Saudi law, consult the official legal text when applying it.