The event featured an impressive lineup of speakers: Mary Anne Scicluna, Senior Executive Director – Supervision; Lawrence Paramasivam, Senior Executive Director – Policy and Legal; and Dr. Bhaskar Dasgupta, Chairman of the Apex Boards in the Middle East and India.
Here are the key takeaways from this impactful discussion:
Board governance and oversight
A robust corporate governance framework is vital for financial institutions to ensure sound and prudent management. Boards should prioritise effective oversight, stakeholder protection, and decision-making processes tailored to their company’s scale and complexity.
Meeting standards
Aim for at least four board meetings annually, blending virtual and in-person attendance. While virtual meetings are convenient, in-person sessions enable in-depth discussions and strategic challenges.
Board composition
An effective board maintains a diverse mix of skills, knowledge, and experience. A balance of representation fosters objectivity and independence, with non-executive and independent directors (NEDs and INEDs) playing a pivotal role in strategic oversight.
Minutes and board packs
Minutes should detail decisions, rationales, and risks, while board packs must be shared in advance, focusing on critical issues to facilitate informed decision-making.
Director responsibilities
Proactive oversight
Directors should demand high-quality materials and ensure agendas address regulatory and strategic priorities, such as liquidity risks. However, they must balance oversight responsibilities with allowing executives to manage day-to-day operations.
Financial monitoring
Closely monitor financial performance, capital adequacy, and liquidity to identify and address potential risks early.
Outsourcing oversight
Directors are accountable for material outsourced activities. Firms should evaluate associated risks, monitor service providers, and implement safeguards to mitigate potential issues.
FSRA expectations
Compliance and governance
Strong governance, integrated with compliance, is crucial for avoiding supervisory and regulatory issues. Boards must embed these principles into their operations.
Economic substance
The FSRA underscores the importance of in-person board meetings to maintain governance effectiveness.
Regulatory engagement
Firms are encouraged to participate in FSRA outreach initiatives to stay informed about compliance and regulatory priorities.
Regional and economic focus
Boosting female participation
UAE initiatives promoting women’s representation on boards were highlighted as drivers of economic growth.
Sector challenges
Participants explored public sector strengths and workforce diversity as opportunities to enhance economic progress in the UAE.
Building a resilient governance framework
Transparency and accountability
Boards should require briefings from internal and external auditors to proactively address risks and enhance transparency.
Whistleblowing protections
A robust whistleblowing program safeguards businesses, reputations, and employees, while promoting accountability.
Director engagement
The FSRA emphasised its commitment to collaborating with boards on improving governance standards, including the adequacy of board materials and membership.
Closing remarks
The roundtable underscored the FSRA’s focus on compliance, governance, and transparency. As Mary Anne Scicluna noted, “Directors, including non-executive and independent directors, play an important role in the oversight of a financial institution. Their ability to challenge management, ask probing questions, and provide objective oversight is crucial.”
Lawrence Paramasivam reinforced the importance of diligence, stating, “Effective corporate governance, underpinned by the independence of directors, is the cornerstone of a robust financial institution.”
The Apex Directors Club remains committed to fostering collaboration and excellence in governance. Future events at ADGM will build on this momentum, driving meaningful progress and strengthening the foundation for effective leadership and accountability.
