Regulatory Alerts2004-11-04
Corporate Governance 2004
The Reserve Bank issued Guideline No. 01-2004/BSD to establish comprehensive corporate governance standards for all licensed banking and non-banking financial institutions. The directive mandates specific board compositions, including a majority of independent non-executive directors and the separation of chairperson and chief executive officer roles, while requiring robust risk management, compliance functions, and internal audit systems. It further enforces strict fiduciary duties, conflict of interest disclosures, quarterly board meetings, and transparent financial reporting to ensure institutional soundness, protect depositors, and strengthen market discipline.
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