Corporate Governance
The Board, led by the Chairman, plays a leadership role under prudent and effective controls framework. Committed to high standards of integrity and ethics, the Board has collective responsibilities for promoting the long-term business sustainability, creating sustainable value to stakeholders and a culture of openness based on the Bank’s purpose and values.
The Board has the ultimate responsibility for the operations and the financial soundness of the Bank. The Board of Directors has established the Audit Committee, Risk Management Committee, Nomination Committee and Remuneration Committee as the Bank’s top level corporate governance structure. In addition, the Bank has also established other committees, such as the Management Executive Committee, Management Committee, Credit Risk Management Committee, Non-Financial Risk Management Committee, Asset Liability Management Committee, AML/CTF & Reputational Risk Committee and Technology Management Committee to oversee the day-to-day operations of the Bank. These committees have specific terms of reference to ensure that they discharge their functions properly and to report back to the Board, where appropriate.
Audit Committee
The duties of Audit Committee (“AC”) include reviewing the financial reporting process of the Group, approving the scope and frequency of audit, and evaluating the effectiveness of the system of internal controls, taking input from internal and external auditors, risk management and compliance functions. The AC shall report to the Board regularly on any significant matters that require Board attention.
The AC approves the audit charter of Internal Audit and ensures that processes are in place for recommendations raised in internal audit reports to be dealt with in a timely manner.
The AC reviews the external auditors’ independence, objectivity and competency (in terms of their skills, knowledge, expertise and resources).
The terms of reference require that the AC shall have at least three Non-executive Directors as members, the majority of whom, including the Chairman, shall be independent. Currently, members of the AC comprise three Independent Non-executive Directors, namely, Mr Hui Leung Wah (Chairman), Mr Chim Wai Kin and Dr Khoo Cheng Hoe Andrew.
The Group’s Whistleblowing Program provides a channel for employees and external parties to raise concerns relating to suspected fraud, misconduct or any other irregularities within the Bank. The AC will be updated on a regular basis on cases received (if any) from whistleblower(s) and appropriate action(s) taken. The whistleblower’s interests will be safeguarded at all times, including the right to appeal if reprisals are taken against him/her.
Risk Management Committee
The Risk Management Committee (“RMC”), which supports the Board in performing its risk oversight responsibilities, comprises Mr Chim Wai Kin (Chairman), Ms Chong Chuan Neo and Mr Hui Leung Wah. All members have the relevant technical financial expertise in risk disciplines or businesses to discharge their responsibilities. Mr Chim Wai Kin and Mr Hui Leung Wah also serve on the AC. The common membership helps to facilitate communication and foster the sharing of information and knowledge between the two Committees.
The RMC has written terms of reference that describes the responsibilities of its members.
The RMC reviews the overall risk management philosophy in line with the overall corporate strategy as set and approved by the Board. It oversees the establishment and operation of an independent risk management system for identifying, measuring, monitoring, controlling and reporting risk on an enterprise-wide basis. This includes ensuring the adequacy and effectiveness of the overall risk management framework and practices for material risks such as credit, liquidity, market, operational, information security and digital, conduct, money laundering and terrorism financing, legal, fiduciary, regulatory, reputational, strategic, environmental (including climate), social and governance (“ESG”) risks, as well as any other category of risk that may be delegated by the Board or deemed necessary by the RMC.
The RMC reviews the scope, effectiveness and objectivity of the Risk Management Division. It ensures that the risk management function has appropriate independent reporting lines and is adequately resourced with experienced and qualified employees to monitor risk by the various risk categories. It approves the risk management frameworks, internal control systems and major policies, as well as reviews the risk appetite statement, risk disclosure policy and risk management principles for the approval of the Board. It also reviews the risk profile, risk tolerance level and risk strategy of the Bank for effective risk management, as well as the risk reports to monitor and control risk exposures. The Chief Risk Officer has direct reporting lines to the RMC and Chief Executive Officer.
Nomination Committee
The duties of Nomination Committee (“NC”) include reviewing and making recommendations to the Board on appointment of Directors, Chairman of the Board, membership of Board Committees, Chief Executive Officer, Alternate Chief Executive and Management Executive Committee members. The NC shall also evaluate and approve the appointment of the Bank’s other senior management members.
The terms of reference require that the NC shall comprise not less than three members and a majority of them, including the Chairman, shall be Independent Non-executive Directors. Currently, members of the NC are Dr Khoo Cheng Hoe Andrew (Chairman), Ms Chong Chuan Neo and Ms Wong Pik Kuen Helen.
Remuneration Committee
The duties of Remuneration Committee (“RC”) include making recommendations to the Board on the Bank’s remuneration system, policies, structure and practices as well as the remuneration packages of Senior Management and Key Personnel. When developing the bank-wide remuneration policy, the RC will consider the Group’s business and corporate objectives, performance, economic and market conditions, risk management and market compensation practices. This policy applies to all staff within the Bank and its subsidiaries.
The terms of reference require that the RC shall comprise not less than three members and a majority of the committee, including the Chairman, shall be Independent Non-executive Directors. Currently, members of the RC are Dr Khoo Cheng Hoe Andrew (Chairman), Ms Chong Chuan Neo and Ms Wong Pik Kuen Helen.
Management Executive Committee
The Management Executive Committee (“MEC”), chaired by Chief Executive Officer, meets regularly to manage the affairs of the Group encompassing all aspects including strategic direction, business and operational strategies, internal controls, risk management, bank culture, sustainability, audit, operations, information technology, legal and compliance matters. The MEC reviews and endorses capital frameworks and policies to ensure proper capital resource management and allocation for the Group.
Management Committee
The Management Committee, chaired by Chief Executive Officer, is a senior management coordination, discussion and communication forum for the Group. It focuses on strategy implementation and communications across business and support functions.
Credit Risk Management Committee
The Credit Risk Management Committee (“CRMC”), chaired by Chief Credit Officer (Wholesale Credit Risk Management), is the principal senior management body that supports and is accountable to the RMC in managing the Group’s credit risk including environmental, social and governance risk under responsible financing. The CRMC oversees the execution of the Group’s credit risk management framework and policies, to ensure that credit risk taking is aligned with the Group’s risk appetite and business strategy.
Non-Financial Risk Management Committee
The Non-Financial Risk Management Committee (“NFRC”), chaired by Chief Risk Officer, is the principal senior management body that supports and is accountable to the RMC and Chief Executive Officer in managing the Group’s overall non-financial risk on a firm-wide basis. The NFRC oversees the Bank’s non-financial risk, to ensure it is managed at accepted tolerance levels and within the risk appetite endorsed by the Bank’s RMC, and approved by the Board of Directors, in supporting the Bank’s business strategy. It also serves as the forum for deliberation and risk acceptance for non-financial risk matters.
Asset Liability Management Committee
The Asset Liability Management Committee, chaired by Chief Executive Officer, is a sub-committee of the MEC, responsible for providing stewardship in managing the Group’s balance sheet. It focuses on liquidity management, interest rate management, market risk management, structural foreign exchange management and internal funds transfer pricing mechanism of the Group
AML/CTF & Reputational Risk Committee
The AML/CFT & Reputational Risk Committee (“ARRC”), chaired by Head of Compliance, is a sub-committee of the MEC, focuses on overseeing the Group-wide management of Financial Crime Compliance (“FCC”) risks, including money laundering, terrorist financing, sanctions, fraud and reputational risk related matters. The ARRC meets regularly, it establishes risk appetites, endorses FCC policies, and provides guidance on transactions that may pose significant FCC or reputational risks.
Technology Management Committee
The Technology Management Committee (“TMC”), chaired by Chief Executive Officer, is a sub-committee of the MEC, responsible for ensuring that the Bank’s investments in IT projects are aligned with the Bank’s overall strategic plan and achieve optimal returns and sustainable benefits. The TMC provides an overview on all ongoing IT projects across the Bank in promoting cross pollination of IT innovations, standardisation where appropriate and optimise opportunity to leverage on global capabilities.