Russian Agricultural Bank regards good corporate governance practices as a key to its long-term success, creating trust and engagement between the Bank and its shareholder, stakeholders, employees, and clients.
Efficient corporate governance practices underpin the successful operations of a company, its sustainable development, risk management, ensuring a balance of the rights and interests of the shareholders, management and other stakeholders. Pursuing the best corporate governance standards also positively impacts the company’s operating results, internal efficiency, investors’ valuation of the company’s securities and ability to raise capital needed for further development.
The Bank’s corporate governance structure ensures a proper balance of governance bodies, leverages authority, and distinguishes between general management process carried out by the General Shareholders Meeting and operations management that is carried out by executive bodies - the Chairman of the Management Board and the Management Board (MB).
There are three committees operating under the Supervisory Board:
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Audit Committee |
Reviews the Bank`s accounting and risks policies, as well as the internal control environment. |
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Strategic Planning and Development Committee |
Sets and supervises general and priority strategic objectives, makes recommendations on the Bank’s dividend policy and evaluates the Bank`s operational effectiveness. |
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HR and Remuneration Committee |
Approves HR Policy and the remuneration policy for senior executives. |
The specialized committees under the Supervisory Board (SB) perform a preliminary review and prepare recommendations on issues within the competence of the Board. All issues concerning operational and strategic management, financial planning, asset and liability management, and business segments are submitted for approval to the SB pass preliminary review by the Management Board.
The Revision Commission is the body responsible for controlling the Bank’s financial and business activity. It carries out the revision of compliance of current operations with the financial plan, analyzes the Bank’s financial position, evaluates the functioning of internal control and risk management systems, and checks the legitimacy of selected transactions.
The Revision Commission is elected according to an order of Rosimushchestvo.
Corporate Secretary is responsible for ensuring procedures aimed at championing the rights and interests of the Bank`s shareholders and support the SB efficient work. Participating in arranging the General Shareholders Meeting and Supervisory Board meetings and working out resolutions which need the approval of the Bank`s shareholder, the Corporate Secretary secures an effective cooperation process between the shareholder and the Bank`s management.
The Management Board is supported by a number of specialized committees and commissions, including:
The Strategy and Corporate Development Committee
The Committee develops proposals and recommendations for the Management Board and its Chairman, and makes decisions to enhance governance at the Bank and across the Group in the following areas:
strategic development,
corporate governance,
development of the functional model and organization structure,
project activities, business process optimization,
general approach to segmentation and customer work,
communications and brand management; document flow management.
The Credit Committee
The Credit Committee considers issues related to lending, setting credit risk for corporate clients limits. The Credit Committee is not authorized to take decisions regarding the settlement of corporate problem loans.
The Junior Credit Committee
The Junior Credit Committee engages in the implementation of the Bank’s credit policy and its enhancement, as well as the minimization of credit risks. It ensures that lending transactions yield a return and are effective, by introducing improved quality and faster decision making, and standardized credit processes.
The Finance Committee
The Finance Committee coordinates multiple aspects of business planning, cost management, pricing, and profitability analysis of banking operations. It is also involved in improving the management of the Bank’s financial and business activities.
The Asset and Liabilities Management Committee (ALCO)
ALCO develops and makes decisions on asset and liability management related issues including: operations to raise funding or allocate funds on the financial markets (securities and derivatives market, FX and money market, stock market and OTC market, where the Bank raises funding and allocates its funds or currency assets, engages in securities transactions, issues or redeems its debt obligations). ALCO is also tasked with decision-making on distributing funds amongst Bank units, managing market risk (including interest and currency risks) and liquidity risk; and developing the Bank’s tariff and interest policy; approving internal accounting and tax regulations.
The Technology Committee
The Technology Committee reviews, coordinates and settles disagreements related to the development and implementation of IT employed in the roll-out and support of the Bank products, services and transactions, including the building of software and IT platforms of the Bank, the development of the Bank’s information security system; developing internal regulations setting forth the procedure for IT support, including information security, banking products, services and operations; improving of existing and developing new banking IT, including information security system; taking part in planning purchases, development and installation of new software and IT infrastructure and information security tools.
The Branch Network Committee
The key functions of the Branch Network Committee include elaboration and decision-making related to enhancing the efficiency of regional branch network’s operation, development, and manageability (including internal units). Moreover, the Committee assesses the performance and takes action to enhance the efficiency of the regional branch network.
The Problem Loan Management Committee
The Problem Loan Management Committee considers and resolves issues of settling corporate problem loans/debts and assets/non-core assets recorded on the Bank’s or its subsidiaries’ balance sheet as part of settlement procedures.
The Corporate Ethics and Discipline Committee
The Corporate Ethics and Discipline Committee exercises overall control of the implementation of shared corporate values and ethical norms, and facilitates the development of a unified corporate culture, including in the sphere of preventing corruption.
The Risk Management Committee
The Risk Management Committee controls the target risk appetite and the aggregated risk profile of the Bank and the Group, making sure that the risk taken falls within the existing limits and thresholds. It monitors the key risk factors that affect the aggregated risk profile of the Bank and the Group, and takes action so that the risk management system (including risk identification, assessment, monitoring, and control processes) functions efficiently and is improved on an ongoing basis; control of the risk management framework compliance with the regulatory requirements, including in view of the introduction of standards of the Basel Committee on Banking Supervision.
The Compliance Committee
The Committee engages in enhancing internal control efficiency including regulatory risk management; working out decisions related to internal control framework.
The Retail Business Development Committee
The major tasks of the Retail Business Development Committee include working out proposals and decisions on enhancing efficiency and demand for retail product range, monitoring yield and profitability of retail products; terms of retail loan and fee-based products, lending and sales procedures and pricing; control of elaboration and launch of retail products; settling problem/overdue retail loans.