The Board of Directors have continued to ensure proper implementation of Corporate Governance principles in the operations of the Group. The Directors have also continued to endorse and insist on compliance with the provisions of the Group’s code of Corporate Governance which has incorporated most of the provisions of the Central Bank of Nigeria (CBN) Code on Corporate Governance for Banks in Nigeria – Post Consolidation.
A. THE BOARD
The Board is composed of 21 members, including the Chairman, who is a non-Executive Director, the Managing Director, 9 Executive Directors and 10 non-Executive Directors.
The Board has three Committees. These are the Risk Management Committee, Finance and General Purpose Committee and the Nominations and Evaluations Committee. In addition to the Board Committees there are regular Management meetings.
Responsibility
The Board reviews corporate performance, authorizes and monitors strategic decisions whilst ensuring regulatory compliance and safeguarding the interests of shareholders. It is committed to ensuring that the Group is managed in a manner that will fulfill stakeholder’s aspirations and societal expectations. The Board has provided leadership for achieving the strategic objectives of the Group.
The Board met six times during the 2006/2007 financial year, and had one orientation session for new Directors.
Appointments & Retirements
During the last financial year Mr. Kayode Sofola SAN retired from the Board and Chief Ferdinand Alabraba, who was the Vice Chairman, was appointed the Chairman of the Board.
Mallam Bello Garba retired as an Executive Director at the last Annual General Meeting and Alhaji Ibrahim M. Jega who was a senior management staff in the Bank, was appointed an Executive Director in his stead.
The appointment was subject to the usual rigorous and transparent process as laid down by both the CBN and the Group’s code of Corporate Governance. This is driven by a desire to ensure that all the Directors of the Bank bring the requisite skills, integrity and experience to bear on the Board’s proceedings.
Chairman and Chief Executive
In line with best practice and in accordance with the provision of the Group's Code of Corporate Governance, the responsibilities of the Chairman and the Chief Executive Officer have remained separate. Whilst the Group’s Chairman Chief Ferdinand Alabraba is responsible for the leadership of the Board and creating the conditions for overall board and individual Director’s effectiveness, the Chief Executive Officer Mr. Tony Elumelu (MFR) is responsible for the overall performance of the Group, including the responsibility of arranging effective day to day management controls.
Professional Development
All Directors are aware that they may take independent professional advice at the expense of the Company, in the furtherance of their duties. They all have access to the advice and services of the Company Secretary, who is responsible to the Board for ensuring that all governance matters are complied with and assists with professional development as required.
B. ACCOUNTABILITY AND AUDIT
Financial Reporting
The Board has presented a balanced assessment of the Company’s position and prospects. The Board is mindful of its responsibilities and is satisfied that in the preparation of its Financial Report it has met with its obligation under the Group’s Code of Corporate Governance.
The Directors make themselves accountable to the shareholders through regular publication of the Group’s financial performance and Annual Reports. The Board has ensured that the Group’s reporting procedure is conveyed on the most up to date infrastructure to ensure accuracy. This procedure involves the monitoring of performance through out the financial year in addition to monthly reporting of key performance indicators.
Internal Controls
The Group has consistently improved on its internal control system to ensure effective management of risks. The Directors review the effectiveness of the system of internal control through regular reports and reviews at Board and Risk Management Committee meetings.
C. CONTROL ENVIRONMENT
The Board has continued to place emphasis on risk management as an essential tool for achieving the Group’s objectives. Towards this end it has ensured that the Group has in place robust risk management policies and mechanisms to ensure identification of risk and effective control.
The Board approves the annual budget for the Group and ensures that a robust budgetary process is operated with adequate authorization levels put in place to regulate capital expenditure.
D. SHAREHOLDER RIGHTS
The Board places considerable importance on effective communication with its shareholders. It ensures that the rights of shareholders are protected at all times. Notice of meetings and all other statutory notices and information are communicated to the shareholders regularly.
E. BOARD COMMITTEES
The Board Committees consist of:
- The Risk Management Committee: This Committee comprises two Executive Directors and two non Executive Directors (one of whom acts as Chairman). The Chief Credit Officer and Legal Adviser are in attendance at the Committee meetings. The Head of Internal Audit also gives regular reports to the Committee on Internal Control exceptions and the compliance status of the Bank. Amongst its other functions, the Committee sets out the Bank’s policies on Corporate Governance, Credit and Risk Management. It also approves credits in excess of the limit set for Management.
- The Nomination and Evaluation Committee: This Committee comprises of three Non-Executive Directors. Amongst its other functions is to recommend an Executive remuneration policy.
- The Finance and General Purpose Committee: The Committee comprises Executive Directors resident in Lagos and non-Executive Directors, one of whom is Chairman of the Committee. The Quorum for the meeting is five out of which two must be non-Executive Directors. Amongst its functions is to recommend strategic initiatives to the Board, reviews the budget and the audited accounts of the Group.
