Embedding Risk Culture in Boards: Lessons from Qatar’s QFMA Governance Code
Every board of directors has the power to influence not just strategy, but shape the very culture of the organisation. When a board adopts the right attitude towards risk, it introduces a culture in which enterprise risk management is part of the decision-making process, rather than a disjointed practice. In Qatar, the new governance framework set out by the Qatar Financial Markets Authority (QFMA) marks a drastic move in the way how boards, senior leadership & risk functions liaise.
With corporate governance and governance compliance coming into the limelight, now is a good time to explore how boards can embed a strong risk culture, turn governance enforcement into value, and use risk advisory guidance to support that journey.
Why Does Risk Culture Matter At Board Level?
Boards are not solely responsible for approving strategic plans and oversight but also for defining the tone at the top. When a board actively makes enterprise risk management part of its agenda, it sends a clear message to the management that: Risk isn’t just a compliance formality; it’s a strategic advantage. Also, Boards that fail to do so expose companies to new threats and opportunities.
Under QFMA governance code, boards are required to:
- Endorse risk-management policies
- Determine the company’s risk appetite
- Oversee internal control frameworks
Key Lessons From the QFMA Governance Code For Boards
The QFMA’s updated governance code for boards came into effect in 2025 and mandates listed companies to align their board structures as well as practices to achieve greater standards.
1. Board Composition and Expertise Matter
The code requires boards of listed companies in Qatar to have 7 to 11 members with at least three of them being independent directors. Boards must collectively have knowledge of strategic planning, internal control, risk management and governance. This provides boards with the capacity to engage meaningfully on enterprise risk management topics rather than treating them as secondary.
2. Risk Oversight as a Core Board Responsibility
Boards play a crucial role in overseeing risk by approving risk-management policies and key systems like internal audits and internal controls. By making this an explicit responsibility, boards emphasize the importance of enterprise risk management & strengthen the connection between risk oversight, corporate governance, and regulatory compliance.
3. Training, Awareness and Risk Culture Building
Boards must ensure that new members receive induction training covering risk management, internal control and compliance; continuing annual programmes are also required. This ensures that board members are not just nominally responsible for risk, but are equipped to engage with it—and build a risk‑aware culture within the organisation.
4. Transparent Disclosure of Risk and Control Systems
Companies must disclose their risk‑management systems, major risk factors, internal control weaknesses, and how they are being addressed. Disclosure supports governance compliance and helps build stakeholder trust; boards that embrace this foster a proactive risk culture rather than a defensive one.
Practical Steps For Boards To Embed A Risk Culture
Drawing from the above lessons, here are practical steps boards can take:
- Define risk appetite clearly: The board ought to exercise its mandate of approving a clear statement of risk-appetite. That assists the management to tune decision making In line with board expectations for enterprise risk management.
- Make risk a standing agenda item: Risk dashboards, control reports and new risks should be reviewed on a regular basis at board meetings. This normalises risk talks.
- Ensure independence and skill mix: Board composition must include independent directors with risk management & governance experience. That supports deeper discussion and oversight of enterprise risk management.
- Foster training and awareness: Regular board-level training in areas like compliance, internal control and risk helps embed the mindset and supports governance compliance.
- Link incentives to risk outcomes: Remuneration and performance rewards should reflect not only growth but also effective risk‑management, thereby strengthening the board’s incentive for a positive risk culture.
- Encourage disclosure and transparency: A culture where issues are flagged early, weakness is disclosed and corrective action taken supports both enterprise risk management and corporate governance objectives.
How MBG Corporate Services Can Help?
For organisations seeking to embed a robust risk culture and ensure full governance compliance under the QFMA framework, MBG Corporate Services provides expert risk advisory solutions. Our team works closely with boards and senior management to design enterprise risk management frameworks that are practical, board‑friendly, and aligned with corporate governance best practices. We support companies in strengthening internal controls, enhancing transparency, building a strong risk culture, and conducting board training programmes that empower directors to make confident, informed decisions.
With MBG, businesses gain not only compliance but also strategic assurance and a proactive approach to enterprise risk management.