Corporate Governance for Banks in Southeast Europe: Policy - IFC

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Policy Brief on Improving Corporate Governance of Banks in the Middle East and North Africa:http://www.hawkamah.org/events/conferences/conference_2009/files/mena-policy-brief-banks.pdf.Principles of Corporate Governance (2004): www.oecd.org/dataoecd/32/18/31557724.pdf.The Role of the Board in Disclosure: An Examination of What Codification Efforts Say (2004):http://www.oecd.org/dataoecd/55/33/32387383.pdf.UNCTADGuidance on Good Practice in Corporate Governance Disclosure: www.unctad.org/en/docs/iteteb20063_en.pdf.64Policy BriefCorporate Governance for Banks in Southeast Europe
C. Synopsis: BCBS Enhancing corporate governance for banking organizations (2006)Sound corporate governance principlesPrinciple 1: Board members should be qualified for their positions, have a clear understanding of their role incorporate governance and be able to exercise sound judgment about the affairs of the bank.Principle 2: The board of directors should approve and oversee the bank’s strategic objectives and corporatevalues that are communicated throughout the banking organization.Principle 3: The board of directors should set and enforce clear lines of responsibility and accountabilitythroughout the organization.Principle 4: The board should ensure that there is appropriate oversight by senior management consistentwith board policy.Principle 5: The board and senior management should effectively use the work conducted by the internalaudit function, external auditors, and internal control functions.Principle 6: The board should ensure that compensation policies and practices are consistent with the bank’scorporate culture, long-term objectives and strategy, and control environmentPrinciple 7: The bank should be governed in a transparent manner.Principle 8: The board and senior management should understand the bank’s operational structure,including where the bank operates in jurisdictions, or through structures, that impede transparency (that is,“know your structure”).The role of supervisorsSupervisors should provide guidance to banks on sound corporate governance and the proactive practicesthat should be in place.Supervisors should consider corporate governance as one element of depositor protection.Supervisors should determine whether the bank has adopted and effectively implemented sound corporategovernance policies and practices.Supervisors should assess the quality of banks’ audit and control functions.Supervisors should evaluate the effects of the bank’s group structure.Supervisors should bring to the board of directors’ and management’s attention problems that they detectthrough their supervisory efforts.Corporate Governance for Banks in Southeast Europe Policy Brief 65
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© Copyright 2012. All rights reser
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II. Overview of bank corporate gove
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A1. Responsibilities of the board 1
Page 14 and 15: A2. Qualifications 19Bank boards sh
Page 17: Tests for integrity are needed. How
Page 20: RomaniaIn Romania, Regulation No. 1
Page 23: A5. Role of the chair 29The chair o
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Page 34 and 35: B. Risk management and internal con
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Page 42 and 43: The disclosure of compensation, whi
Page 44 and 45: Skepticism regarding disclosureBeyo
Page 46: decision concerning the appointment
Page 49 and 50: Recommendations:Disclosure and tran
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Page 53 and 54: examinations permit a systematic ev
Page 55 and 56: Recommendation:Remedial action: Sup
Page 57 and 58: VI. Additional issuesA. State owner
Page 59 and 60: VII. AnnexesA. Southeast Europe Pol
Page 61 and 62: INTERNATIONAL EXPERTSPeter Dey, Cha
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Page 67 and 68: Complex or opaque corporate structu
Page 69 and 70: oard. The supervisory board is resp
Page 71 and 72: Bulgaria19.1% Others16.3% Unicredit
Page 73 and 74: Romania19% BCR (Erste)13.1% BRD (So
Page 75: For information requests and genera
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Corporate Governance for Banks in Southeast Europe: Policy - IFC

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