Banken for en verden i endring The bank for a ... - BNP Paribas

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Banken for en verden i endring The bank for a ... - BNP Paribas

• report of the Chairman / corporate governance at BNp paribas

STRATEGy

Group strategy is among the key responsibilities

of the Board of Directors of BNP Paribas (1) .

Based on proposals submitted by Executive

Management, the key elements of which are

presented following a documented in-house

process, directors approve the objectives set

out; they then monitor implementation, particularly

in the course of discussions on the financial

statements and budgets.

In 2006, strategic issues accounted for a significant

part of the Board’s work. They were handled

through three complementary approaches.

The full Board meets in a strategic formation

once a year, with the Group’s key operational

leaders attending. It met in this formation in

2006 for a session exclusively devoted to

defining the Group’s overall strategy. It discussed

the outlook for banking groups worldwide

and identified medium-term trends for

each of the Group’s core businesses. It set

strategic focuses for the following year and

launched the BNP Paribas three-year project

for 2008-2011.

• Three of the Board’s ten meetings of the year

were specially convened to deal with and

decide upon, as the main or only order of

business, major investment projects (2) furthering

the Group’s strategy.

• During the other regularly-scheduled meetings

of the Board, the directors reviewed the

progress – either of negotiations or of actual

implementation – of the investment projects

that they had previously authorised.

(1) The strategic vocation of the Board of Directors is the very first principle of sound corporate governance identified by the Basel

Committee (February 2006): the Board should “approve the overall business strategy of the bank…”. It is also emphasised in the

recommendations on “The Corporate Governance of Listed Corporations” of AFEP-MEDEF 2003 (1).

(2) The internal rules of the Board of Directors specify that the Board’s prior approval is required for any investment or disinvestment

project of more than EUR 250 million.

(3) AFEP-MEDEF 2003 (4).

In accordance with its internal rules, the Board

must be consulted on any material operation

which lies outside the Bank’s disclosed business

strategy; such an operation requires its

prior approval. This clause was not applied in

2006 (3) .

The BNP Paribas Group’s financial communications

frequently include information on its strategic

focuses. Such information is presented to

shareholders: at the Annual General Meeting

of 31 May 2002, the BNP Paribas “Project for

2005” had been described in detail; the Annual

General Meeting of 18 May 2005 also included

a presentation on the Group’s “2007 Vision”.

These medium-term plans had also been disclosed

to financial markets at the same time.

147

CORPORATE GOvERNANCE

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