Basel Committee suggests Corporate Governance Principles for Banks

Last October, the Basel Committee published a draft of the revision of the Corporate Governance Principles for Banks. The document can be accessed here and is opened for public comments by January 9, 2015.
The objective is to strengthen the guidance on risk governance, expand the guidance on the role of Boards of Directors in managing risks, emphasize the importance of the Board’s collective and individual competence, provide guidance for bank supervisors and focus on the compensation system of senior managements as an incentive structure for risk-taking behaviors.
Among the recommendations, a highlight is the need of having an Auditing Committee exclusively comprised of independent members with broad knowledge of the financial and banking sectors. It is also recommended that banks have a Chief Risk Officer (CRO) with “sufficient stature, independence, resources and access to the Board.”
Recommendations serve as inspiration for all organizations concerned about the integrity of their internal control and risk management systems.