PRINCIPLE: The Board should exercise responsibility, leadership, enterprise, integrity and judgment in directing the institution so as to achieve continuing prosperity for the institution and act in its best interest, in a manner based on transparency, accountability and
equity. Every institution should be headed by
an effective Board that can lead and control the institution.
Therefore,
without prejudice to the
statutory duties of directors, the functions
of the Boards of financial institutions should include but not be limited to the following:
i.
Approving and reviewing corporate strategy, major plans of action,
annual budgets and business plans; setting performance
objectives; monitoring implementation and corporate performance; and
approving major
capital expenditures, acquisitions and divestments.
ii.
Ensuring that the institution has adequate systems of internal controls both operational and financial.
iii.
The selection,
performance appraisal and compensation of senior executives.
iv.
Reviewing key executive
and board remuneration and ensuring a formal and transparent board nomination process.
v.
Ensuring the integrity
of the institution's accounting and financial reporting system.
vi.
Ensuring that ethical
standards are maintained and that the institution complies with applicable laws and regulations.
vii.
Ensuring adequate
disclosure and communications.
viii.
Succession planning.
ix.
Setting out an
acceptable risk management guideline.
x.
The non-executive directors on the Board should
not be involved in the day to day operations of the institution, which should be the primary responsibility of the Chief Executive
Officer and the Management team.
It should be emphasised that good corporate governance rests ultimately
with the Board of Directors. In identifying
that good corporate governance hinges on Board competence and integrity, it
should be realised that standards of probity and fiduciary responsibility in
the wider business environment are equally critical.
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