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  • HC-4 HC-4 Appointment, Training and Evaluation of the Board

    • HC-4.1 HC-4.1 Principle

      • HC-4.1.1

        The conventional bank licensee must have rigorous and transparent procedures for appointment, training and evaluation of the Board.

        October 2010

    • HC-4.2 HC-4.2 Nominating Committee

      • HC-4.2.1

        The board must establish a Nominating Committee of at least three directors which must:

        (a) Identify persons qualified to become members of the board of directors or Chief Executive Officer, Chief Financial Officer, Corporate Secretary and any other officers of the conventional bank licensee considered appropriate by the Board, with the exception of the appointment of the internal auditor which shall be the responsibility of the Audit Committee in accordance with Paragraph HC-3.2.1 above; and
        (b) Make recommendations to the whole board of directors including recommendations of candidates for board membership to be included by the board of directors on the agenda for the next annual shareholder meeting.
        October 2010

      • HC-4.2.2

        The committee must include only independent directors or, alternatively, only non-executive directors of whom a majority must be independent directors and the chairman must be an independent director. This is consistent with international best practice and it recognises that the Nominating Committee must exercise judgment free from personal career conflicts of interest.

        October 2010

    • HC-4.3 HC-4.3 Nominating Committee Charter

      • HC-4.3.1

        The Nominating Committee must adopt a formal written charter which must, at a minimum, state the duties outlined in Paragraph HC-4.2.1 and the other matters included in Appendix B to this Module.

        October 2010

    • HC-4.4 HC-4.4 Board Nominations to Shareholders

      • HC-4.4.1

        Each proposal by the board to the shareholders for election or reelection of a director must be accompanied by a recommendation from the board, a summary of the advice of the Nominating Committee, and the following specific information:

        (a) The term to be served, which may not exceed three years (but there need not be a limit on reelection for further terms);
        (b) Biographical details and professional qualifications;
        (c) In the case of an independent director, a statement that the board has determined that the criteria of independent director have been met;
        (d) Any other directorships held;
        (e) Particulars of other positions which involve significant time commitments, and
        (f) Details of relationships between:
        (i) The candidate and the conventional bank licensee, and
        (ii) The candidate and other directors of the conventional bank licensee.
        October 2010

      • HC-4.4.2

        The chairman of the board should confirm to shareholders when proposing re-election of a director that, following a formal performance evaluation, the person's performance continues to be effective and continues to demonstrate commitment to the role. Any term beyond six years (e.g. two three-year terms) for a director should be subject to particularly rigorous review, and should take into account the need for progressive refreshing of the board. Serving more than six years is relevant to the determination of a non-executive director's independence.

        October 2010

    • HC-4.5 HC-4.5 Induction and Training of Directors

      • HC-4.5.1

        The chairman of the board must ensure that each new director receives a formal and tailored induction to ensure his contribution to the board from the beginning of his term. The induction must include meetings with senior management, visits to the conventional bank licensee's facilities, presentations regarding strategic plans, significant financial, accounting and risk management issues, compliance programs, its internal and external auditors and legal counsel.

        October 2010

      • HC-4.5.2

        All continuing directors must be invited to attend orientation meetings and all directors must continually educate themselves as to the conventional bank licensee's business and corporate governance.

        October 2010

      • HC-4.5.3

        Management, in consultation with the chairman of the board, should hold programs and presentations to directors respecting the conventional bank licensee's business and industry, which may include periodic attendance at conferences and management meetings. The Nominating Committee shall oversee directors' corporate governance educational activities.

        October 2010