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Corporate Governance Committee

Composition as at 31 December 2014:
Mohamed Ali Al Dhaheri (Chairman), Sheikh Sultan bin Suroor Al Dhahiri, Khalid Deemas Al Suwaidi and Omar Liaqat
Secretary: Rami Raslan

Statement from the Chairman of the Corporate Governance Committee

Dear Shareholders,

During 2014, the Corporate Governance Committee continued to oversee the development of the Bank’s governance policies. In particular, the Committee engaged the Bank’s divisions to assess their development of certain key governance themes, and oversaw the Board evaluation and implementation of policy adjustments arising from that evaluation.

The Corporate Governance Committee monitors local and international best practices regularly, and reviews and makes recommendations to the Board to enhance the Bank’s governance practices in order to achieve high standards of corporate governance.

The Committee adopted a rolling agenda for 2014 that focused on, amongst other things, ethics & compliance; bribery & fraud; strategy governance; risk governance; IT governance; sustainability & corporate social responsibility; and procurement governance.

The Committee held five meetings over the course of 2014. Amongst other things, in 2014 the Corporate Governance Committee worked on the following matters:

• reviewing the results of the 2013 Board evaluation and the adoption and monitoring of the action plan arising from it;
• reviewing and recommending amendments to Board and management committees’ terms of reference;
• reviewing and recommending amendments to the Bank’s governance policies;
• engaging the Bank’s divisions and various businesses in its governance framework and providing guidance on enhancing governance practices;
• Directors’ professional development programmes;
• ongoing review of international developments in corporate governance and assessment of Bank practices;
• considering corporate governance sponsorships;
• publication of corporate governance information;
• making recommendations to the Board and Board Committees on governance matters; and
• considering internal Bank initiatives to further embed corporate governance within the organisation.

The Corporate Governance Committee plays an advisory role, reporting its recommendations to the Board for final approval. The Committee considers that the Bank has developed a robust governance framework, appropriate for the size and status of the Bank. However, there remain areas for improvement.

The Board’s Corporate Governance Committee has developed an agenda to further embed the governance culture across the Bank. Group heads of various functions of the Bank are invited regularly to update the Committee on their governance initiatives. Each group head is required to present on achievements, present status and intended courses of action with regards to governance conduct of such functions.

The Committee considers that positive progress was made during 2014 in the implementation of the Bank’s corporate governance initiatives. The Bank’s ongoing achievements in corporate governance resulted in the Bank receiving the “Corporate Governance Award — UAE” from World Finance magazine in 2014. The Bank also received the Hawkamah Bank Corporate Governance Award. Hawkamah is a regional initiative aimed at recognising, supporting and encouraging superior governance practices in the banking sector in the Middle East, North Africa and South Asia. The award reaffirms our position as a regional leader in governance practices. This is due to commitment across all levels of the Bank, including the Chairman, Board Members, CEO, senior management and staff.

Looking at 2015

The Committee’s agenda for 2015 reflects its ongoing commitment to governance across the Bank through a series of deep-focus sessions into governance matters, including, amongst other things, subsidiary governance, enhancing disclosures, applying Basel guidelines on corporate governance for banks (currently in draft form), complaint-handling processes, and products and services governance. The Bank intends to raise governance awareness across various levels of its staff by rolling out e-learning modules.

Mohamed Ali Al Dhaheri

Chairman of the Board’s Corporate Governance Committee