Abu Dhabi: Abu Dhabi Department of Economic Development (ADDED), in collaboration with The Endowments and Minors' Funds Management Authority (Awqaf Abu Dhabi), has issued a resolution on the establishment and licensing of endowment institutions in Abu Dhabi.
According to Emirates News Agency, this landmark resolution marks a significant advancement in enhancing endowment structures, supporting the sustainability of family-owned businesses, and promoting best practices in endowment management. It reinforces Abu Dhabi's leadership in endowment governance and strengthens the contributions of non-profit organizations and associations (Third Sector) to the gross domestic product (GDP).
This resolution, the first of its kind in the UAE, introduces a comprehensive regulatory framework that formalizes the endowment sector's role in sustainable socio-economic development. It aligns with the UAE's Year of Community 2025, under the theme Hand in Hand, reflecting the vision of President His Highness Sheikh Mohamed bin Zayed Al Nahyan to promote sustainable growth, a knowledge-based economy, and social solidarity.
The resolution builds upon existing laws addressing family-owned endowments and introduces structured governance for such entities. It provides a framework for the creation and administration of endowment companies, covering aspects such as legal status, permitted activities, and licensing requirements.
By establishing clear legal and regulatory guidelines, the resolution enables companies, institutions, and individuals to contribute to long-term social and economic progress. All applications must be approved by Awqaf Abu Dhabi to ensure compliance with current regulations, donor intentions, and the broader objectives of the grant.
Under the new framework, endowment companies will have the ability to manage private grants while engaging in commercial activities that support the sustainability and expansion of endowed assets, maximizing both financial returns and social impact. The resolution also introduces robust monitoring and supervisory mechanisms to enhance governance and accountability within the sector.
Rashed Abdulkarim Al Blooshi, Undersecretary of ADDED, emphasized the pivotal role of endowments in socio-economic development. 'Endowments have been playing a vital role in the socio-economic development for many decades. Issuing this resolution to establish and license endowment companies in Abu Dhabi aims to provide suitable frameworks to enable them to grow and thrive. This is in line with the emirate's vision, which places human development, sustainability, and economic inclusion at the core of its strategic plans to accelerate economic growth and diversification, and further enhance a knowledge-based, innovation-driven economy.'
Fahad Abdulqader Al Qassim, Director-General of Endowments and Minors' Funds Management Authority, highlighted the resolution's role in balancing sustainable investment and prudent risk management across various asset classes. 'This resolution reflects the strategic partnership between Awqaf Abu Dhabi and ADDED, establishing a regulatory framework that fosters endowment investments and maximizes their social and economic impact. It reinforces the sustainability of family-owned businesses and ensures the continuity of donors' philanthropic legacies for generations to come. This embodies the UAE leadership's vision of securing a dignified quality of life and promoting solidarity, in alignment with the UAE's Year of Community 2025.'
The resolution encompasses various types of endowment institutions, including private (family-owned) endowments, charitable endowments, and joint endowments. It also allows for the management of endowed shares and equity stakes in commercial enterprises, provided such provisions are explicitly included in the articles of incorporation and are in accordance with applicable laws.
This initiative aims to attract further investment into the endowment sector, strengthening its contribution to Abu Dhabi's sustainable economic and social development agenda. It supports the UAE's broader economic diversification strategy, reinforcing the emirate's position as a leading hub for philanthropy and responsible investment.
Leveraging Abu Dhabi's strategic position as a global investment gateway, Awqaf Abu Dhabi launched Awqaf Capital, its dedicated investment arm, in December 2024. This initiative is set to deploy capital across diverse asset classes, further cementing Abu Dhabi's role as a center for sustainable endowment management and international investment.
