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Board Control Manual contents
Overview of governance of:
Board Committees (Remuneration, Audit, Risk, Nomination)
Senior Independent Director
Chief Risk Officer
How good are your Board controls?
Board controls are the cornerstone of a successful Board and good governance. Without appropriate controls in place, there may be inappropriate actions, no succession planning, an eclectic nomination process, duplication of responsibilities, a haphazard remuneration structure and effort or large gaps in control and the risk of fraud and regulatory censure.
Many firms have the vast majority of controls in place, they just don't have it fully documented so cannot prove it when the regulators come calling. Other firms have everything documented, but not in one place, inaccessible and unread by most of the Board members.
The easiest way to install and maintain effective Board controls is to ensure that they are all clearly stated in one place via a Board Control Manual or a dedicated section of the company intranet, and all relevant people advised of their whereabouts.
One of the regulatory 'hot topics' is Board governance and they frequently check Board Controls during a visit. Evidence of a comprehensive Board Control Manual ticks many regulatory boxes. See Hector Sants Governance speech for the FSA's views for 2012. This theme has carried forward into the PRA and FCA regulatory regimes.
"We will work with firms to ensure that the accountabilities of approved persons are clearly defined
by firms and understood by us, as clear accountability is a key reinforce of the behaviours we expect from individuals and firms. In particular, we are looking to see whether our knowledge of SIF accountability within firms improves so we can ensure senior management accountability for issues. This should provide greater clarity over who is accountable for problems that arise, including conduct issues, and firms should expect to see increased enforcement action against approved persons who breach our rules as a result. When approving an individual to a firm’s board, we will consider the appropriateness of an individual’s appointment within the context of the board’s overall composition." FCA Business Plan 2013
- Board unawareness of records existence
- Board members' failure to recall details of governance arrangements
- Out of date records - the governance structure has changed.
- New legislative requirements not shown in records (often the case with audit risk and compliance committees).
- Disparate filing systems for various pieces of information
BP&E Global works with companies to ensure all of their governance arrangements are in place, fully documented, and accessible. We can also act as a second pair of eyes and provide a pulse check to internally prepared documentation.
Contact BP&E Global to discuss your Board control requirements.
BP&E Global - because Board Performance Matters