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Directors’ Roles And Responsibilities
The primary role of the Board of Directors (the Board) is to oversee the implementation of the Bank’s strategic initiatives. Additionally, the Board ensures that the Bank operates within the agreed framework, following all relevant statutory and regulatory structures.
The Board monitors the adequacy of the financial systems, operations, and internal control. They also oversee the implementation of corporate ethics and the Code of Conduct. They also conduct regular meetings to discuss strategic issues, performance reviews, material acquisition, disposal of assets, capital expenditure, authority levels, the appointment of auditors, review of the financial statements, financing and borrowing activities, annual operating plan and budget, regulatory compliance, and assessment of internal controls.
The majority of BBK Directors, including the Chairman and/or the Deputy Chairman, are required to attend the Board meetings to ensure a quorum. In addition, the Board must approve all policies and decisions about the Bank’s operation and functions.
The overall management of the Bank is delegated to the Chief Executive. The Bank Directors hold their respective position for three years, after which they must present themselves to the Annual General Meeting
Board Compositions
The Board is composed of ten members selected based on the Bank’s Memorandum of Association and Articles of Association. It comprises a mix of professionals with high-level skills, expertise, industry background, and experience. The Board is required to conduct periodic reviews regarding its composition and the contribution of Directors and Committees.
The appointment of Directors is subject to the approval of the Central Bank of Bahrain (CBB). The classification of ‘Executive,’ ‘Non-Executive,’ and ‘Independent Non-Executive’ Directors are based on definitions stipulated by the CBB.
Board Committees
The Board Committees are considered the high-level link between the Board and the Executive Management. The Board of Directors forms the Committees and their Members at the beginning of each term. Their roles are to assist the Board in supervising the operations of the Bank, review the issues submitted by the management to the Board, and make recommendations to the Board for their final review and decision.
The Board reserves the right to form temporary committees and discontinue them as necessary. Furthermore, the Board Members are provided with copies of Board Committees’ meeting minutes as required by the regulators.
Board Meetings and Attendances
The Board meets as instructed by the Chairman, Deputy Chairman (in the absence or disability of the Chairman), or if requested by at least two Directors. The Board must meet at least four times a year, per the Commercial Law. A Board Meeting shall only be valid if at least seven Directors participate in person.
- The Code of Conduct shall be circulated to all existing Members of the Board of the Bank and it shall be binding on them.
- Breaches of the Code shall be dealt with either by the Board of Directors or by a Committee established for this purpose.
- Members of the Board of Directors shall discharge their duties professionally, with due diligence and to the best of their abilities.
- A member of the Board must not take any benefit from any projects or investments which are managed by the Bank or promoted to its customers or potential customers except for Board related remuneration in the performance of his/her fiduciary duties to the investors of the project/investment (i.e. Director is appointed as member of the Board of special purpose vehicle or other operating companies set up by the Bank for projects/investments). The Director must not receive any commission, fees, shares/consideration in kind or other remuneration of incentives in respect of the performance of the project/investment. Any Board-related remuneration received by the Director must accordingly be declared to the Board on an annual basis.
- Members of the Board shall be duty bound to conduct themselves honestly and sensitively with respect to acceptance of certain functions, prerequisites or assignments which could conflict with the knowledge acquired by them in the performance of their duties as members of the Board of Directors of the Bank. They shall continue to be bound by this obligation after termination of their duties.
- Members of the Board of Directors shall declare forthwith, in writing, to the Chairman of the Board any other official or professional position(s) held by them at any point during their term of their membership in the Board.
- Members of the Board shall not allow other direct or indirect professional relationships to affect in any way the conduct or their activities for the Bank, and visa versa. Where a member of the Board of Directors, using his best judgement, comes to the conclusion that he may have a conflict of interest with regard to a decision to be taken by the Board of Directors, he shall immediately declare so to the Chairman of the Board. When the Chairman of the Board of Directors is personally involved he shall immediately declare to the Deputy Chairman who will take necessary action.
- A member or the Chairman of the Board of Directors having declared a conflict of interest concerning a decision of the Board shall leave the meeting room during the time of discussing that subject and if the issue is sent by circulation the concerned member shall abstain from voting on the subject
- If a member of the Board of Director is offered an official or professional position which may give rise to a permanent conflict of interest as regards his duties and responsibilities as a member of the Board of Directors of the Bank, he shall inform the Chairman of the Board and shall seek to ascertain whether accepting such position would be compatible with his duties and responsibilities as member of the Board.
- Members of the Board of Directors shall not divulge any confidential information or data coming to their knowledge during the performance of their duties to persons or bodies outside the Bank, other than persons assisting them in the discharge of their duties as Board members, provided that such persons are subject to an equivalent level of confidentiality. They shall continue to be bound by this obligation after termination of their membership in the Board.
- Members of the Board of Directors who in the context or course of their duties, have direct or indirect access to or are in possession of inside information of the Bank, its branches and subsidiaries may not make use, either directly or indirectly of this inside information in order to carry out, recommend or advise either in favour of or against transactions involving the Bank or its branches and subsidiaries for their own account or that of third parties.
- “Inside Information” shall mean information a) which is of precise nature b) has not been made public, c) which if made public would be likely to have a significant effect on the price of securities of the Bank or it subsidiaries.
- Bank has KP Trading Policy consistent with Bahrain Bourse and CBB’s Guidelines on KPs’ and their dealing in bank’s securities. All members of the Board (elected/nominated) and institutions which nominate directors are considered as KPs.
- All KPs shall declare, in writing to the Group Corporate Secretary, all requested information in this regard, including ‘connected persons’, ‘controlled corporations’ and ‘corporations in which the KP exercises influence’. The information relates to KP’s, basic data, initial beneficial ownership and subsequent changes thereof.
- Any changes in basic information and change in ownership regardless of the type of such change and howsoever occurring, from time to time, should be advised to the Group Corporate Secretary by the end of the next business day.
- The KP should inform his ‘connected persons’, ‘controlled corporations’ and ‘corporation in which person exercises influence’ that he is a KP in the Bank.
- For the purpose of this Code, any interest in the shares of the Bank held by ‘connected person’ ‘controlled corporations’ and ‘corporation in which person exercises influence’ of the member of the Board of Directors, shall be deemed to be interests of the relevant member of the Board of Directors.
- Members of the Board of Directors shall not apply for, receive or accept from any source any advantage, direct or indirect, which is in any way connected with his mandate in the Bank. The members of the Board of Directors should therefore discourage the offer of any gift having more than a token value. However, should it be impossible to refuse, notably because such refusal could prove embarrassing to the donor, the gift is to be surrendered to the Bank through the intermediary of the Group Corporate Secretary.
- Exclusive to the above clause are giveaways, which are defined to be any gift which has a market value of no more than BD 50/- or bears the logo or commercial trade mark of the donor.
- In their dealings with Bank staff, members of the Board of Directors shall refrain from exerting any pressure which might result in any infringement of regulations or deviation from procedures, for example in management of the Bank’s assets, award of contracts, management of human resources or financial transactions.
- Should the need arise, the members of the Board of Directors shall co-operate fully with persons charged with conducting any regulatory investigation.
- The Board for Directors considers the Bank’s customers as one of the important stakeholders as per its corporate governance practices. The Board pays due regard to the legitimate interests and information needs of customers and shall ensure that the Bank communicates with them in a fair and transparent manner.
- All members of the Board of Directors shall sign this Code of Conduct, including any new members who may assume office as from this date.
- These signed copies shall be held by the Group Corporate Secretary.
