CBUAE Issues Draft Guidance on Individual Conduct for Board Members and Staff of Licensed Financial Institutions

4 min 32 sec February 23, 2026 (Edited) الترجمة العربية

Written by

Anand Singh

Legal Director

a.singh@tamimi.com View LinkedIn Profile

The Central Bank of the UAE (“CBUAE”) has issued a draft “Guidance on Individual Conduct for the Board and Staff of Licensed Financial Institutions” (the “Guidance”), dated October 2025. The Guidance establishes minimum standards of individual conduct applicable to all board members and staff of Licensed Financial Institutions (“LFIs“), a term which, under Federal Decree-Law No. (6) of 2025 Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business (the “Central Bank Law“), encompasses banks, insurance companies, reinsurance companies, Takaful insurance companies, and other financial institutions licensed by the CBUAE. The Guidance extends to persons engaged under outsourcing arrangements and applies across all functions and units within LFIs.

Insurance sector application

For the UAE insurance industry, the Guidance will apply to all insurance companies, Takaful insurance and other Insurance Related Professions licensed under the Central Bank Law. This includes both locally incorporated insurers and branches or subsidiaries of foreign insurers operating within the UAE but excludes those operating in Financial Free Zones. The Guidance should be read in conjunction with existing CBUAE regulations applicable to the insurance sector, including the Financial Regulations for Insurance Companies, the Corporate Governance Regulation for Insurance Companies, the Risk Management Regulation and Standards for Insurance Companies, and the Code of Conduct and Ethics for Insurance Companies and other Insurance Related Professions.

Key principles of conduct

The Guidance articulates eight core principles of professional conduct.

• First, competence requires board members and staff to possess and maintain the academic qualifications, professional knowledge, skills and experience necessary to perform their roles effectively, including through continuous professional development.
• Second, honesty, ethics and integrity mandate that individuals act with due skill, care and diligence, prioritising the interests of the LFI and its stakeholders over personal interests.
• Third, fair treatment of customers requires a customer-centric approach, prohibiting discrimination, mis-selling and the exertion of undue pressure on customers.
• Fourth, confidentiality and data protection obligations require adherence to stringent data protection practices and cybersecurity protocols, with duties extending beyond termination of employment.
• Fifth, transparency in communications requires that all internal and external communications be accurate, clear and not misleading.
• Sixth, conflicts of interest must be identified, disclosed and managed, with individuals required to abstain from decision-making where conflicts exist.
• Seventh, compliance with applicable laws and regulations encompasses anti-money laundering requirements, market conduct rules and, notably, environmental, social and governance responsibilities.
• Eighth, cooperation with the CBUAE requires open, transparent and timely engagement with the regulator, including proactive disclosure of material matters.

Implementation and responsibilities

The Guidance sets out detailed implementation requirements for LFIs. Institutions must integrate the Guidance into their corporate culture and policy framework, developing or updating internal conduct rules that are approved by the board and mandatory for all board members and staff. These internal rules must reflect the institution’s specific business model and risk profile, address conflicts of interest, misuse of information and whistleblowing, and be reviewed at least annually. LFIs are required to notify board members and staff of the Guidance, maintain evidence of acknowledgement and training records, and ensure accessibility via the institution’s intranet. Secure and confidential whistleblowing channels must be established, with protections against retaliation. The risk management framework must incorporate conduct-related risk, including proactive identification and mitigation of risks arising from unethical behavior, regulatory breaches and poor customer outcomes. Compliance with the Guidance should form part of contractual obligations between the institution and its board members and staff.

Impact on institutions

The Guidance will have significant practical implications for the insurance industry. Insurance industry stakeholders will need to conduct a comprehensive gap analysis of their existing governance frameworks, codes of conduct, training programs and remuneration policies against the Guidance’s requirements. Particular attention should be given to the interplay between the Guidance and existing sector-specific regulations, including the Corporate Governance Regulation for Insurance Companies and the Risk Management Regulation and Standards, which already impose obligations regarding board composition, risk culture and internal controls. The emphasis on ‑continuous professional development will require insurers to enhance training programs for underwriters, claims handlers and customer-facing staff. The conflicts of interest provisions may necessitate review of commission structures and related-party transaction policies. The whistleblowing requirements will require investment in secure reporting channels and anti-retaliation policies. For insurance brokers, ‑‑the Guidance reinforces and extends the obligations under the existing Code of Conduct for Insurance Brokers, particularly regarding customer fair treatment and transparency. Non-compliance may result in disciplinary action at the individual level and regulatory sanctions at the institutional level, with potential implications for fitness and propriety assessments of senior management and board members.

Next steps

The Guidance is currently in draft form and dated October 2025. Once finalised, it will serve as a key benchmark for professional conduct across all LFIs in the UAE. The Guidance does not replace existing laws or regulations but should be read in conjunction with the Central Bank Law and all applicable CBUAE regulations, which take precedence in the event of conflict. Insurance sector participants are advised to commence a review of their existing policies, procedures and training programs against the draft Guidance to identify gaps and prepare for implementation. Institutions should also monitor for any supplementary regulations or standards that the CBUAE may issue to support consistent implementation across the sector. Given the broad scope of the Guidance and its application to individual conduct, there is an increased risk of regulatory enforcement action and potential disputes arising from alleged breaches of conduct standards, particularly in relation to customer complaints, whistleblowing matters and conflicts of interest.