https://www.myjoyonline.com/bog-drafts-new-corporate-governance-guidelines-for-rcbs/-------https://www.myjoyonline.com/bog-drafts-new-corporate-governance-guidelines-for-rcbs/

The Bank of Ghana has drafted a new Corporate Governance Guidelines for Rural and Community Banks.

The objectives of the directive is to compel regulated financial institutions to adopt sound corporate governance principles and best practices to enable them undertake their licensed business in a sustainable manner and also to promote the interest of depositors and other stakeholders by enhancing corporate performance and accountability of regulated financial institutions.

Others are the promotion and maintenance of public trust and confidence in regulated financial institutions by prescribing sound corporate governance standards and the maximization of shareholders value and interests.

Per the guideline, a person cannot be appointed onto the board if he or she has been declared insolvent or has entered into any agreement with another person for payment of that person’s debt or has been adjudged to be of unsound mind.

Others are he/she has been convicted of an offence involving fraud, dishonesty or moral turpitude; he/she has been a director, key Management personnel associated with the management of an institution which is being or has been wound up by a court of competent jurisdiction on account of bankruptcy or an offence committed and is a director or key management personnel of another bank, specialised deposit taking institution or financial holding company in the country.

The rest are a person who is under the age of 18 years; a person who does not have the prior written approval of the Bank of Ghana or has defaulted in the repayment of the financial exposure of that person.

Also, a person before assuming office as a director or key management personnel of a regulated financial institution, shall also declare to the board of that regulated financial institution and the Bank of Ghana the professional interests of that person or the office that person holds as manager, director, trustee or by any other designation, amongst others.

Shareholding and Ownership

For shareholding and ownership, it shall be restricted to only Ghanaians.

In that regard, an ownership by an individual shall not exceed 30% of total shares whilst family or related party ownership shall also not exceed 40% of total shares.

Board Charter

The Board shall also operate under a Board Charter which outlines the appropriate governance practices for its own work and have in place the means to ensure such practices are followed and periodically reviewed for improvement.

It also defines the authority of the board and sets out minimum standards including overall board responsibility, Code of Ethics for Directors, structure of the board and competence/qualifications to indicate required skills set, diversity, knowledge and experience.

Duties of the Board

The duties of the board include to act honestly and in good faith; to act in the best interests and for the benefit of the regulated financial institution and having a duty to act independently, free from undue influence of any person.

According to the Bank of Ghana, Corporate Governance means the manner in which the business and affairs of an RCB is governed by its Board and Key Management.

This includes how its strategy and objectives are set; risk appetite/tolerance are determined; day-today business is operated; interests of depositors are protected and shareholders obligations are met.

It also includes aligning corporate activities and behaviour with the expectation of operating in a safe and sound manner, with integrity and compliance with applicable laws and regulations.

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DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.