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Manual on
CORPORATE GOVERNANCE
APPROVED VIA REFERENDUM ON OCTOBER 8, 2014
Version April 17, 2018
MANUAL ON CORPORATE GOVERNANCE
TABLE OF CONTENTS
I. Definition of Terms 1
II. Declaration of Principles 4
III. Corporate Governance Policies 4
IV. Governance Structure 14
V. Disclosure On Material Information 37
VI. Communication Process 38
VII. Training Process 38
VIII. Reportorial Or Disclosure System Of Bank‘s
Corporate
Governance Policies
39
IX. Shareholder‘s Benefit 39
X. Monitoring And Assessment 39
XI. Penalties For Non-Compliance With The Manual 44
References 44
Annex A: Director’s Charter Of Expectations 45
Annex B: List Of Disclosures For Directors 46
Annex C: Self-Assessment Form – Chairman of the Board 47
Annex D: Self-Assessment Form – Members of the Governing
Board
49
Annex E: Self-Assessment Form – CEO/President 51
Annex F: Peer Assessment Form (Chairperson Evaluation) 54
Annex G: Peer Assessment Form (Members of the Governing
Board Evaluation)
56
Annex H: Peer Assessment Form (President/CEO Evaluation) 58
Annex I: Charter of the Audit and Compliance Committee 61
Annex J: Charter of Corporate Governance Committee 64
Annex K: Charter of Risk Oversight Committee 67
Annex L: Code of Ethics 70
1
MANUAL ON CORPORATE GOVERNANCE
This Manual was approved and adopted by the Board of Directors of the Al-Amanah Islamic
Investment Bank of the Philippines (AAIIBP) last 07 April 2014, via referendum and noted by
the Board last 24 July 2014. This Manual shall institutionalize the principles and practices of
good corporate governance in the entire organization as prescribed by GCG MC No. 2012-07
and BSP Circular No. 749-2012.
The Board, Management, officers and staff of the Bank believe that corporate governance is a
necessary component of what constitutes sound strategic business management and will
therefore undertake every effort necessary to create awareness within the organization and
acknowledge that the same shall always guide the attainment of the Bank‘s corporate goals and
objectives.
I
DEFINITION OF TERMS
For purposes of this Manual, the following terms shall have the following meanings:
1. Bank - refers to Al-Amanah Islamic Investment Bank of the Philippines (AIIBP) created
under Republic Act No. 6848;
2. Board of Directors - refers to the collegial body that exercises the corporate powers,
conducts all business and controls or holds all properties, of the Bank, composed of
nine (9) members of the AIIBP Board duly elected by the General Stockholders‘ Meeting
as provided under Section 25 of RA #6848;
3. Board Officers - refer to Officers whose primary task is to serve the Board or to pursue the
immediate functions of the Board, such the Chairman, Vice-Chairman and the Corporate
Secretary;
4. Chief Executive Officer (CEO) - refers to the highest ranking corporate executive who
heads Management, who is also named Chairman of the Board of the Bank per Section
27 of RA #6848;
5. Confidential Information - refers to all non-public information entrusted to or obtained by
a member of the Board or Officer by reason of his/her position as such with the Bank. It
includes, but is not limited to, non-public information that might be of use to competitors
or harmful to the Bank or its customers/stakeholders if disclosed, such as (1) non-public
information about the Bank‘s financial condition, prospects or plans, its marketing and
sales programs, and research and development information, as well as information
relating to mergers, acquisitions, divestitures, stock splits and similar transactions; (2)
non-public information concerning possible transactions or ventures with other
companies, or information about suppliers, joint venture partners, or any information that
2
the Bank is under obligation to keep confidential; and (3) non-public information about
internal discussions, deliberations and decisions, between and among Directors and
Officers.
6. Executive Officer - refers to the CEO or whoever is the highest ranking officer in the
Bank, and such other corporate officer of the Bank as expressly provided for in its
Charter, such as the Vice President, Chief Financial Officer, Risk Officer, Compliance
Officer, Bank Security Officer, etc. As distinguished from Board Officers, Executive
Officers primarily form part of the Management of the Bank;
7. Extraordinary Diligence - refers to the measure of care and diligence that must be
exercised by Directors and Officers in discharging their functions, in conducting the
business and dealing with the properties and monies of the Bank, which is deemed met
when Directors and Officers act using the utmost diligence of a very cautious person
taking into serious consideration all the prevailing circumstances and Material Facts,
giving due regard to the legitimate interests of all affected Stakeholders;
8. Fit and Proper Rule - refers to a set of standards for determining whether a member of the
Board of Directors or the CEO is qualified to hold a position in the Bank which shall
include, but not limited to, standards on integrity, experience, education, training and
competence as such standards are set forth under GCG Memorandum Circular No. 2012-
05;
9. Independent Directors - refer to members of the Board who are non-executive members
and not part of the executive committee or day to day management of banking operations;
10. Management - refers to the body given the authority to implement the policies
determined by the Board in directing the course and business activities of the Bank;
11. Material Information/Fact - refers to information which a reasonable investor,
stakeholder or Supervising Agency would consider important in determining whether: (1)
to buy, sell, hold or otherwise transact with the securities issued by the Bank; or (2) to the
exercise with reasonable prudence voting rights related to securities held with the Bank,
or relating to corporate acts, contracts and transactions which would adversely affect the
operation of the Bank;
12. Officers - refer to both Board Officers and Executive Officers
13. Per Diems - refer to the compensation granted to members of Governing Boards of the
Bank for actual attendance in meetings;
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14. Performance Evaluation System (PES)- refers to the process of appraising the
accomplishments of the Bank in a given fiscal year based on set of performance criteria,
targets and weights;
15. Performance Scorecard - refers to a governance and management tool forming part of the
performance evaluation system which consists of a set of measures, targets and initiatives
that facilitate the achievement of breakthrough results and performance through the
effective and efficient monitoring and coordination of the strategic objectives of the
Bank;
16. Performance Evaluation for Directors (PED) – refers to the measurement of overall
performance of an Appointive Director as prescribed by GCG Memorandum Circular No.
2014-03
17. Related Party Transactions - refer to transactions, business deals or arrangements
between two or more parties joined by a special relationship prior to the transaction
which are not illegal per se but may create actual or potential conflicts of interest.
18. Republic Act No. 6848 - refers to the Charter of Al-Amanah Islamic Investment Bank of
the Philippines;
19. Sharia‘h Advisory Council - refers to a group of not more than five (5) members from
among Islamic scholars and jurists of comparative law as provided in Section 4 of the
Charter of the Bank under RA #6848;
20. Sharia‘h Rules – refer to rules and conduct established by Sharia‘h scholars and jurists
21. Stakeholders - refers to any individual or entity for whose benefit the Bank has
constituted, or whose life, occupation, business or well-being is directly affected, whether
favorably or adversely, by the regular transactions, operations or pursuit of the business
or social enterprise for which the Bank has been constituted, and which would include a
stockholder, member, or other investor in the Bank, management, employees, supply
creditors, or the community in which the Bank operates;
22. Strategy Map - refers to an integrated set of strategic choices or objectives drawn by the
governing body, the successful execution of which results in the achievement of the
Bank‘s vision in relation to its mission or purpose for having been created;
4
II
DECLARATION OF PRINCIPLES
The Al-Amanah Islamic Investment Bank of the Philippines, its directors, officers and
employees hereby commit and endeavor to promote a culture of good corporate governance by
faithfully observing and maintaining its core values of integrity, love for the Filipino, excellence,
teamwork and service to others in their relationship among themselves and with the Bank‘s
stakeholders. They shall at all times be accountable to the people and shall discharge their duties
with utmost responsibility, integrity, competence and loyalty, act with patriotism and justice,
lead modest lives and uphold public interest over personal interest.
The Bank also promotes the importance of adopting global principles and best practices to guide
the AAIIBP Board of Directors and Management in directing and governing the affairs of the
Bank, with the end view of maximizing its long term value for the benefit of its stakeholders and
to ensure that a culture of ethics, compliance and social responsibility pervade in all levels of
banking operations.
III
CORPORATE GOVERNANCE POLICIES
A. The Directors and Officers of the Bank believe and abide with the following principles:
Fiduciaries of the State
The directors and officers of the Bank accept the responsibilities as fiduciaries of the state
and that: (a) they have the legal obligation and duty to always act in the best interest of the
Bank, with utmost good faith in all dealings with the properties, interest and monies of the
Bank, and (b) they are constituted as trustees in relation to the properties, interests and
monies of the Bank.
Norms of Conduct as Public Servants
As Public Officials, directors and officers of the Bank are covered by the provisions of the
―Code of Conduct and Ethical Standards for Public Officials and Employees‖ and abide
with the following principles:
(a) To promote a high standard of ethics in public service; and
(b) Be accountable to the people and shall discharge their duties with utmost responsibility,
integrity, competence and loyalty, act with patriotism and justice, lead modest lives and
uphold public interest over personal interest.
5
Respect for and Obedience to the Constitution and the Law
Respect and obey the Constitution, and comply, and cause the Bank to faithfully and timely
comply, with all legal provisions, rules and regulations, and corporate governance standards,
applicable to the directors and officers and to the Bank and to act within the bounds of the
Bank‘s Charter (RA #6848) and its By-Laws.
Duty of Diligence
The fiduciary duty of diligence of Directors and Officers to always act in the best interest of
the Bank, with utmost good faith in all its dealings with the property and monies of the
Bank, including the obligation to:
(a) Exercise extraordinary diligence, skill and utmost good faith in the conduct of the
business and in dealing with the properties of the Bank, using the utmost diligence of a
very cautious person with due regard to all the circumstances.
(b) Apply sound business principles to ensure the financial soundness of the Bank; and
(c) Elect and/or employ only Officers who are fit and proper to hold such office with due
regard to the qualifications, competence, experience and integrity as prescribed by Sec.
19(e) of R.A. No. 10149 and BSP Circular No. 749 series of 2012.
Every director and officers, by the act of accepting such position in the Bank, affirms and
agrees:
(1) To have a working knowledge of the statutory and regulatory requirements affecting the
Bank he is to serve, including the contents of its Charter and By-Laws, the requirements
of the GCG, and where applicable, the requirements of other Supervising Agencies like
BSP; and
(2) To always keep himself informed of industry developments and business trends in order
to safeguard the Bank‘s interests and preserve its competitiveness.
Duty of Loyalty
The Directors and Officers of the Bank, acknowledging the fiduciary duty of loyalty,
commits to always act in the best interest of the Bank, with utmost good faith in all its
dealings with the property and monies of the Bank, including the obligation to:
(a) Act with utmost and undivided loyalty to the Bank;
(b) Avoid conflicts of interest and declare any interest they may have in any particular
matter before the Board, and
(c) Avoid (1) taking for themselves opportunities related to the Bank‘s business; (2) using
the Bank‘s property, information or position for personal gain; or (3) competing with the
Bank‘s business opportunities.
6
Avoid Conflict of Interest
Directors and Officers shall at all times avoid any actual or potential conflict of interest
with the Bank. Each shall also avoid any conduct, or situation, which could reasonably
be construed as creating an appearance of a conflict of interest.
Any question about a Director‘s or Officer‘s actual or potential conflict of interest with
the Bank shall be brought promptly to the attention of the Chairman of the Board, who
will review the question and determine an appropriate course of action.
Trustee Relation to Bank’s Properties, Interests and Monies
Except for the per diem received for actual attendance in board meetings and the
reimbursement for actual and reasonable expenses and incentives as authorized by the
GCG, any and all realized and unrealized profits and/or benefits including, but not
limited to, the share in the profits, incentives of Directors or Officers in excess of that
authorized by GCG, stock options, dividends and other similar offers or grants from
corporations where the GOCC is a stockholder or investor, and any benefit from the
performance of Directors or Officers acting for and in behalf of the Bank in dealing with
its properties, investments in other corporations, management of Subsidiaries and other
interest, are to be held in trust by such Director or Officer for the exclusive benefit of the
Bank.
Taking of Corporate Opportunities
Where a Director or an Officer, by reason of his being a member of the Board or an
Officer of the Bank, acquires or receives for himself/herself a benefit or profit of
whatever kind or nature, including but not limited to, the acquisition of shares in
corporations where such Bank has an interest, the use of the properties of the Bank for
his/her own benefit, the receipt of commission(s) on contract(s) with the Bank or its
assets, or the taking advantage of corporate opportunities of the Bank, all such profits or
benefits shall be subject to restitution pursuant to Sec. 24 of R.A No. 10149, without
prejudice to any administrative, civil or criminal action against members of such
Director or Officer. The remedy of restitution shall apply notwithstanding the fact that
such Director or Officer risked his/her own funds in the venture.
Restitution
The Director or Officer receiving without authority properties or monies belonging to the
Bank or that profits earned in violation of his/her fiduciary duty, or the aggregate per
diems, allowances and incentives received in a particular year in excess of the limits
provided under R.A. No. 10149, shall immediately return the same to the Bank upon the
7
determination and report of the Commission on Audit (COA) pursuant to a Notice of
Disallowance which has become final and executory.
Failure by a Director or Officer to make the restitution within thirty (30) days after a
written demand has been served shall, after trial and final judgment, subject such
Director or Officer to the punishment of imprisonment for one (1) year and a fine
equivalent to twice the amount to be restituted and, in the discretion of the court of
competent jurisdiction, disqualification to hold public office pursuant to Art. 24 of R.A.
No. 10149.
Limits to Compensation, Per Diems, Allowances and Incentives
The Directors and Officers of the Bank commit to observe the limits of compensation, per
diems, allowances and incentives as prescribed by the Bank‘s Charter, the governing law of
the country and as determined by the GCG using as reference, among others, Executive
Order No. 24, dated February 10, 2011. Directors of the Bank shall not be entitled to
retirement benefits.
No Gift Policy
Bank‘s Directors and Officers shall not solicit, nor accept, directly or indirectly, any gift,
gratuity, favor, entertainment, loan or anything of monetary value (―Gift‖) from any person
where such /gift:
(a) Would be illegal or in violation of law;
(b) Is part of an attempt or agreement to do anything in return;
(c) Has a value beyond what is normal and customary in the Bank‘s business;
(d) Is being made to influence the member of Board‘s, or Officer‘s actions as such; or
(e) Could create the appearance of a conflict of interest
The particular set of rules governing the ―No Gift Policy‖ of AAIIBP is presented in a
separate Memorandum Circular No. 05A-2013 (re-issued) dated April 7, 2014, signed by the
Chairman and CEO and issued as implementing policy of the Board of Directors‘ approval.
Duty of Confidentiality
Pursuant to their duties of diligence and loyalty, the Board and Officers of the Bank affirm
not to use or divulge confidential or classified information officially made known to them by
reason of their office and not made available to the public, either: (1) to further their private
interests, or give undue advantage to anyone; or (2) which may prejudice the public interest.
Transparency
The Board and Officers of the Bank shall ensure transparency in disclosures over the Bank‘s
operations, public disclosure, financial reporting of all business matters of the Bank at all
8
times and promote policies, such as the Bank‘s Whistleblower Protection Policy, that lead to
a positive and ethical workplace, and prevent retaliation against any employee who will raise
issues pertaining to business conduct and ethics.
Professionalism
The Board and Officers of the Bank commit to perform and discharge duties with the highest
degree of excellence, professionalism, intelligence and skill.
Fairness and Sincerity
At all times, the Board and Officers of the Bank shall act with fairness and sincerity and shall
not discriminate against anyone especially the poor and the underprivileged, and shall respect
the rights of others and refrain from doing acts contrary to law, good morals, good customs,
public policy, public order, public safety and public interest.
Political Neutrality
The Board and Officers of the Bank shall provide service to everyone without unfair
discrimination, regardless of party affiliation or preference.
Responsiveness to the Public
The Board and Officers of the Bank shall extend prompt, courteous, and adequate service to
the public. Unless otherwise provided by law, or when required by public interest, the Board
and Officers and employees of the Bank shall provide information of the Bank‘s policies and
procedures in clear and understandable language, ensure openness of information, conduct
public consultations and hearings, wherever appropriate, encourage suggestions, simplify and
systematize policies, rules and procedures, avoid red tape and develop an understanding and
appreciation of the socio-economic conditions prevailing in the country, especially in the
depressed rural and urban areas.
Nationalism and Patriotism
The Board and Officers of the Bank commit to be loyal to the Republic and to the Filipino
people, especially the Muslim community, promote the use of locally produced goods,
resources and technology and encourage appreciation and pride of country and people.
Commitment to Democracy
The Board and Officers of the Bank commit to the democratic way of life and values,
maintain the principle of public accountability and manifest by deeds the supremacy of
civilian authority over the military.
9
Compliance to Shariah Rules
The Board and Officers of the Bank shall adhere to the Shariah rules in the conduct of the
Bank‘s business and in its dealings with its stakeholders and shall uphold the Islamic culture
in the Bank‘s environment.
B. Formal Recognition of the Stakeholders
The Bank identifies and recognizes the following stakeholders that form part of the total
banking system where the organization revolves:
(1) The Government, Republic of the Philippines
(2) Development Bank of the Philippines – as major stakeholder owning 99.88%
(3) The minority Stockholders – representing 0.12%
(4) The Filipino people with particular mention for Muslims in Mindanao and in other parts
of the country
(5) The Bank employees
(6) Depositors/Customers/Clients
(7) Regulatory Agencies (BSP, GCG, PDIC, COA, SEC, CSC, DOF, OGCC)
(8) Suppliers
C. Relationship with Stakeholders
The Bank acknowledges the hierarchical system of stakeholders as follows:
1. The Filipino people with particular mention for Muslims in Mindanao and in other parts of
the country as a supreme stakeholder, the Bank being a government institution;
2. The Government, Republic of the Philippines, as an important stakeholder next to its
people;
3. The Development Bank of the Philippines with 99.88% interest, which provide the much
needed capital to keep the Bank sustain its operation;
4. The minority Stockholders representing 0.12% interest for their contribution to the
capitalization of the Bank;
5. The Depositors/Customers/Clients without whose support and patronage will not keep the
Bank an on-going business;
10
6. The Bank employees whose loyalty and committed service keeps the Bank strong to hurdle
all crisis;
7. The Regulatory Agencies (BSP, GCG, PDIC, COA, SEC, CSC, DOF, GOCC) which
constantly reminded the Bank of the good governance doctrine and compliant with
regulatory policies and procedures;
8. The Suppliers that provide the needed infrastructure and services for a continuous
operation.
The Bank shall, at all times, provide our stakeholders accurate, effective and sufficient reports
and render accounting of all its undertakings in the following manner:
# Stakeholders Type of Report Frequency
1 The Filipino People Financial Statements Quarterly
2 The Government of the
Philippines
Audited Financial
Statements
Annually, posted in
the Bank‘s website
3 The Development Bank of the
Philippines
Financial Statements
Report of Bank‘s Operations
Monthly
Stockholder‘s
meeting
4 Minority Stockholders Report of Bank‘s Operation Stockholder‘s
meeting
5 Depositors/Customers/Clients Financial Statements Quarterly as
published
6 The Bank Employees Financial Statements Monthly
7 Regulatory Agencies Depending on what the
Regulatory Agencies need
As required
8 Suppliers Goods and services
requirements per posting at
the PhilGEP‘s website
As need arises
To maintain harmony in the conflicting interests of stakeholders, the following policies are
adopted by the Bank:
1. The interest of the people is of primordial importance to the Bank. The Bank shall
maintain a website that is open to the general public where the telephone numbers and
email addresses of the Bank and the Branches are posted to provide venue for the general
public to send or air their complaints about the Bank. The Bank maintains an
Administrative Officer at the Makati Executive Office who answers telephone queries
and keeps track of all incoming messages from email. A suggestion box is kept in the
Branches to receive written complaints from the general public.
11
All complaints received by the Bank shall be reported to the Chairman and CEO for
proper disposition. The Chairman and CEO shall report to the respective Board
Committees and the Board all complaints received, acted and decided/disposed by the
Bank.
2. The Bank shall keep abreast with all laws, rules and regulations of the Government of the
Philippines that are relevant in the operation of the Bank. The Bank‘s Compliance
Officer shall report to the Audit and Compliance Committee any violation in the Bank,
including the action plan/resolution.
3. The Bank‘s management shall closely coordinate with the supervising department of the
Development Bank of the Philippines (DBP) which handles the affairs of subsidiaries to
ensure that all requirements of DBP are complied and all concerns are adequately and
appropriately acted upon.
4. The minority stockholders shall be provided with appropriate notice of stockholders‘
meeting to ensure that their interests are properly protected. The Bank‘s Corporate
Secretary shall monitor the attendance of minority stockholders in stockholders‘ meetings
and shall encourage the minority stockholders to actively participate in the discussions
especially about the operation of the Bank.
5. The Bank shall provide its officers and employees with a competitive compensation
package consistent with the GOCC Compensation and Position Classification System
(CPCS) and provides opportunities for training and value formation to assist them in their
career path strengthen their commitment to excellence in public service and cultivate
their social and environmental awareness and nationalism.
6. The Bank shall provide the highest standards of service, the most appropriate products and
to deal with integrity and honesty to all its depositors/customers/clients for a successful
and sustained business relationship.
7. The Bank shall provide timely and accurate reports of operations and appropriate and
necessary disclosures of all relevant information as required by all regulatory agencies
like the BSP, GCG, PDIC, COA, SEC, and CSC. DOF and OGCC.
8. The Bank shall ensure compliance with the governments Procurement Law (RA #9164)
and comply with desired transparency, equity and justice to all the Bank‘s suppliers of
goods and services.
12
D. Other Bank’s Obligations and Responsibilities
Obligations of the Bank to Directors and Officers
(1) The Bank shall provide the members of its Governing Board with reasonable support
staff and office facilities to allow them to properly discharge their duties and
responsibilities.
(2) Obtaining of Directors and Officers Liability Insurance (DOLI)
Having imposed the highest level of responsibility and accountability of extraordinary
diligence on the members of the Board and Officers of the Bank, it is equitable that the
Bank shall obtain a ―Directors and Officers Liability Insurance‖ coverage for itself and
the members of the Governing Board and Officers against contingent claims and
liabilities that may arise from, as well as the expenses that may be incurred in
prosecuting, the actions that maybe filed against the Bank arising from the actions of the
Governing Board and/or Management that may cause loss or damage to third parties,
when the Bank itself and/or members of the Board and Management are sued before
tribunals on matters that are within the official functions and capacity and on matters
where business judgment has been exercised in good faith, that there be proper recovery
of the costs of litigation and the judgment liability imposed.
The expenses for insurance premiums for DOLI shall be for the account of the Bank
unless a judgment of liability is decreed against a Director or Officer for breach of any of
his fiduciary duties or for fraud committed in the performance of his or her duties to the
Bank and/or its stakeholders.
Corporate Social Responsibility
The Bank shall develop a comprehensive Corporate Social Responsibility Program to share
the benefits of financial success of the Bank focusing on areas of education, environment,
OFW advocacy and empowerment of the most disadvantaged sector of society, particularly
in the Muslim communities.
Relations with Stakeholders
Every Director and Officer of the Bank accepts the position fully aware that he assumes
certain responsibilities not only to the Bank and its stockholders, but also with different
constituencies or stakeholders, who have the right to expect that the Bank is being run in a
prudent manner and with due regard to the interests of all Stakeholders. Consequently,
members of the Board and Officers shall deal fairly with the Bank‘s employees, customers,
suppliers and other Stakeholders. No member of the Board or Officer may take unfair
advantage of the Bank‘s employees, customers, suppliers and other Stakeholders through
manipulation, concealment, abuse of confidential or privileged information,
misrepresentation of material facts, or any other unfair-dealing practice.
13
The Directors, Officers and all its employees shall abide by ethical policies as mandated by
the GCG, with full awareness of the disciplinary implications of breaches thereof that will
affect the reputation and goodwill of the Bank.
Every member of the Bank is encouraged to promptly report any potentially illegal, improper
and/or unethical conduct that they become aware of at their workplace or in connection with
their work. The Bank shall maintain an environment that enables its people to raise genuine
and legitimate concerns internally.
In the event that the people of the Bank and/or the stockholders believe that their reporting to
management may result in harassment, or undue distress, they may contact GCG support to
report such matters. The GCG provides for an opportunity for concerns to be investigated
and ensures appropriate action is taken to resolve the matter effectively.
The Private Sector
The Bank shall adhere to the initiatives and best practices of the private sector on good
governance and to uphold the highest standards of ethics in all transactions in accordance
with the Unified Code of Conduct for Business (UCC). The Bank is also committed to
pursue the good governance program under the Performance Governance System on
Balanced Scorecard of the Institute of Solidarity in Asia and the Institute of Corporate
Directors.
Health and Safety
The Bank shall ensure to provide a safe and healthy working environment for all its
employees, depositors, customers/clients, suppliers and visitors. The Bank shall comply with
all relevant local legislation or regulations and best practice per guidelines recommended by
national health and safety authorities in all its offices and branches and shall accordingly
inform all employees about these guidelines and practices in order to maintain a healthy, safe
and enjoyable working environment.
In the Environment
The Bank will always consider the fact that there are inevitable environmental impacts
associated with daily operations and the Bank will strive to minimize the harmful effects to
the environment by developing and implementing environmental standards. The Bank shall
observe the 3 R‘s: ―Reduce‖, ―Re-use‖ and ―Recycle‖.
The Disadvantaged Sector of Society
Extend the benefit of the Bank‘s Corporate Social Responsibility Program and provide access
to unbankable sector of society in the Muslim Areas up to the limits of existing laws like
AMLA and the General Banking Act.
14
In the Philippine Development Plan particularly in Muslim Mindanao
The Bank shall promote and accelerate the socio-economic development of the Autonomous
Region by performing banking, financing and investment operations and to establish and
participate in agricultural, commercial and industrial ventures based on Islamic concept of
banking in support to the Philippine Development Plan, particularly in Muslim Mindanao.
IV
GOVERNANCE STRUCTURE
A. Management Philosophy
The Bank is committed to ensure the highest standards of corporate governance with the
objectives of safeguarding the interest of all stakeholders.
The business activities of the Bank are subject to Shariah compliance and confirmation by
the Shariah Advisory Committee. It is the responsibility of Management to ensure that the
Bank conducts its business in accordance with Shariah principles as determined by the
Shariah Advisory Committee.
The Bank shall anchor its business strategies and principles on the following philosophies:
Participative Management
The Bank shall conduct all decision-making processes on a collective manner and consensus
of the majority will always be respected. Consultations with employees and relevant
stakeholders will be conducted in an environment conducive to free expression of ideas.
Good Governance
The Bank shall adhere to the principles of sound management and will maintain fairness,
responsibility, accountability, and proper disclosure.
Transparency
Information will be made freely available and accessible to those who will need and has
interest to the transaction, subject to the limitations of existing laws on confidentiality and
disclosure.
People Development
The Bank shall aim to be a high performing organization with deep concern for human
resource development.
15
B. Board of Directors
1. Composition
The Board shall be composed of nine (9) members to be appointed by the President of the
Philippines from a shortlist prepared by the Governance Commission for GOCCs, whose
nominees shall be selected pursuant to R.A. No. 6848 (Charter of Al-Amanah Islamic
Investment Bank of the Philippines) and GCG MC No. 2012-04 (Re-Issued).
2. Primary Responsibilities and Duties
Having been vested directly by law with the legal capacity and authority to exercise all
corporate powers, conduct all the business and to hold all the properties of the Bank, the
Governing Board is primarily responsible for the governance of the Bank and is primarily
accountable to the State for its operations and performance.
3. General Responsibilities and Duties
The Governing Board is responsible for providing policy directions, monitoring and
overseeing Management actions, as articulated in Section 26 of RA #6848 (Charter), and
other relevant legislation, rules and regulations. These mandated functions and
responsibilities include the following:
(a) Provide the corporate leadership of the Bank subject to the rule of law and the
objectives set by the National Government through the Supervising Agencies and the
GCG;
(b) Establish the Bank‘s vision and mission, strategic objectives, policies and procedures,
as well as defining the Bank‘s values and standards through:
Charter Statements;
Strategy Maps
Other control mechanism mandated by best business practices;
(c) Formulate important policies that bear on the character of the Bank to foster its long-
term success, ensure its long-term viability and strength, and secure its sustained
competitiveness;
(d) Determine the organizational structure of the Bank, defining the duties and
responsibilities of its Officers and employees and adopting a compensation and benefit
scheme that is consistent with the Bank‘s Compensation and Position Classification
System (CPCS) developed by GCG and formally approved by the President of the
Philippines;
(e) Ensure that personnel selection and promotion shall be on the basis of merit and
fitness and that all personnel action shall be in pursuit of the applicable laws, rules and
regulations;
(f) Provide sound written policies and strategic guidelines on the Bank‘s operating budget
and major capital expenditures, and approve the annual and supplemental budgets of
the GOCC;
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(g) Comply with all reportorial requirements, as required in the Charter and By-Laws, as
well as applicable laws, rules and regulations;
(h) Formally adopt and conduct annually the mandated Performance Evaluation System
(PES) and the Performance Scorecard and timely and accurate report the results to the
GCG;
(i) Ensure the fair and equitable treatment of all Stakeholders and enhancing the Bank‘s
relations with its Stakeholders.
(j) Approve and oversee the implementation of the Bank‘s strategic objectives, risk
strategies, corporate governance and corporate values;
(k) Ensure that Bank‘s assets and resources are used efficiently and that Bank‘s exposure
to all forms of liabilities and subsidies is warranted and incurred through prudent
means;
(l) Ensure that the operation and governance are carried out in a transparent, responsible
and accountable manner and with the utmost degree of professionalism and
effectiveness; and
(m) Comply faithfully with the reporting and evaluation system governing the Bank,
including the periodic disclosure and examination of their operations and
management, their assets and finances, revenues and expenditures.
4. Specific Duties and Functions
In addition to those functions expressly specified in the Bank‘s Charter and By-Laws, the
Board shall perform the following specific functions:
(a) Execute a Formal Charter of Expectations (Annex ―A‖) at the start of their term and
List of Disclosures (Annex ―B‖) as required by GCG, including a Statement
confirming the truth and fairness of the Bank‘s financial statements;
(b) Meet regularly, ideally at least once every month, to properly discharge its
responsibilities, with independent views expressed during such meeting being given
due consideration, and that all such meetings shall be properly documented or
minuted;
(c) Determine the Bank‘s purpose and value, as well as adopt strategies and policies,
(d) including risk management policies and programs, in order to ensure that the Bank
survives and thrives despite financial crises and that its assets and reputation are
adequately protected;
(e) Monitor and evaluate on a regular basis the implementation of corporate strategies and
policies, business plans and operating budgets, as well as Management‘s over-all
performance to ensure optimum results;
(f) Adopt a competitive selection and promotion process, a professional development
program, as well as a succession plan to ensure that the Officers of the Bank have the
necessary motivation, integrity, competence and professionalism;
(g) Monitor and manage potential conflicts of interest of Directors, management and
shareholders, including misuse of corporate assets and abuse in related party
transactions;
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(h) Implement a system of internal checks and balances, which may be applied in the first
instance to the Board; and ensure that such systems are reviewed and updated on a
regular basis;
(i) Ensure the integrity of the Bank‘s accounting and financial reporting systems,
including independent audit, and that appropriate systems of control are in place, in
particular, systems for risk management, financial and operational control, and
compliance with the law and relevant standards;
(j) Identify and monitor, and provide appropriate technology and systems for the
identification and monitoring of key risks and performance areas;
(k) Adopt, implement and oversee the process of disclosure and communications;
(l) Constitute an Audit Committee and such other specialized committees as may be
necessary, or required by applicable regulations, to assist the Board in discharging its
functions; and
(m) Conduct and maintain the affairs of the Bank within the scope of its authority, as
prescribed in its Charter and By-Laws, and applicable laws, rules and regulations.
(n) Approve and oversee implementation of policies governing major areas of the Bank‘s
operation including:
1. Defining the Bank‘s level of risk tolerance in its major areas of banking operation;
2. Providing for a mechanism that will ensure compliance with established policies
and procedures including compliance with reportorial requirements;
3. Setting out of matters and authorities reserved to it for decision which include,
among others, major capital expenditures, equity investments and divestments; and
4. Establishing limits of discretionary powers of each officer, committee, sub-
committee and such other groups for purposes of lending, investing or any other
financial undertaking which exposes the Bank to significant risks.
(o) Oversee the selection and performance of Senior Management through:
1. Appointment of competent management teams who are qualified to administer the
Bank‘s affairs effectively and soundly;
2. Appointment/employment only of officers who are fit and proper to hold such
offices with due regard to their qualifications, competence, experience and
integrity;
3. Monitoring and assessment of the performance of the management team based on
established performance standards consistent with the Bank‘s strategic objectives;
4. Establishment of appropriate plan of succession for members of Senior
Management;
5. Conduct of regular meetings with Senior Management to engage in discussion,
question and critically review the reports and information as provided by the latter;
6. Regular review of the Bank policies, internal controls and self-assessment
functions with Senior Management to determine areas for improvement; and
7. Provide over-all independent check on management.
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(p) Consistently conduct the affairs of the Bank with a high degree of integrity by:
1. Taking the lead in establishing the tone of good governance and in setting
corporate values, codes of conduct and other standards of appropriate behavior for
itself, senior management and other employees.
2. Articulating clear policies on the handling of any transaction with Directors,
Officers, Stockholders and Related Interests (DOSRI) and other related parties
ensuring that there is effective compliance with existing laws, rules and
regulations at all times and that no stakeholder is unduly disadvantaged;
3. Articulating acceptable and unacceptable activities, transactions and behaviors that
could result or potentially result in conflict of interest, personal gain at the
expenses of the institution or unethical conduct;
4. Articulating policies that will prevent the use of facilities of the Bank in
furtherance of criminal and other improper or illegal activities;
5. Regularly monitoring and reviewing the compensation scheme to ensure that it
operates and achieves the objectives as intended;
6. Ensuring that employee pension funds are fully funded or the corresponding
liability appropriately recognized in the books of the Bank at all times;
7. Allowing employees to communicate, with protection from reprisal, legitimate
concerns about illegal, unethical or questionable practices through its
Whistleblower Protection Policy and Grievance Machinery, among others; and
8. Articulating policies to effectively communicate corporate values, codes of
conduct and other standards in the Bank as well as the means to confidentially
report concerns or violations to an appropriate body.
(q) Define appropriate governance policies and practices for the Bank and for its own
work and to establish means to ensure that such are followed and periodically
reviewed for ongoing improvement including:
1. Ensuring that the Bank‘s organizational structure facilitates effective decision-
making and good governance;
2. Maintaining and periodically updating the Bank‘s organizational rules or other
similar documents setting out its organization, rights, responsibilities and key
activities;
3. Ensuring that independent views in Board meetings are given full consideration
and that all such meetings are duly minuted;
4. Conducting and maintaining the affairs of the institution within the scope of its
authority as prescribed in its charter and existing laws and regulations;
5. Establishing a system of checks and balances which applies in the first instance to
the Board itself; and
6. Assessing, at least annually, its performance and effectiveness as a body, as well
as its various committees, the President/CEO, the individual directors and the
Bank itself.
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(r) Constitute committees to increase efficiency and allow for deeper focus in specific
areas including:
1. Approving, reviewing and updating, at least annually or whenever there are
significant changes therein, the respective charters of each Board committee; and
2. Ensuring that each committee maintains appropriate records of their deliberations
and decisions.
(s) Non-executive board members shall meet regularly other than in meetings of the audit
and risk oversight committees, in the absence of senior management, with the external
auditor and heads of the internal audit, compliance and risk management functions.
(t) Approve loans, fix rates of interest on loans and prescribe such terms and conditions
for loans and credits as may be deemed necessary, consistent with the provisions of
the Bank‘s Charter; Provided, that the Board may delegate the authority to approve
loans to such competent officer or officers as may be deemed necessary;
(u) Be responsible for the proper administration and management of trust and other
fiduciary businesses including determination and formulation of general policies and
guidelines on the handling of trust accounts;
5. Specific Duties and Functions in relation to Subsidiaries and Affiliates
The Governing Board of the Bank, being a parent company, shall have overall
responsibility for defining an appropriate corporate governance framework that shall
contribute to the effective oversight over entities which the group, while at the same time,
respecting the independent legal and governance responsibilities that may apply to the
regulated subsidiary boards.
Responsibilities of the Board of the Bank as parent company shall include:
(a) Ensuring the adoption of corporate governance policies and systems across the group,
including commitment from all entities in the group to meet all of the governance
requirements.
(b) Understanding the roles, relationships or interactions of each entity in the group with
one another and with the Bank.
(c) Developing sound and effective systems for the generation and sharing of information
within the group, management of risks and effective supervision of the group.
(d) Defining and approving policies and clear strategies for the establishment of new
structures.
(e) Defining and approving appropriate governance policies, practices and structures that
will enable effective oversight of the entire group, taking into account the nature and
complexity of operations, size and type of risks to which the Bank and list subsidiaries
are exposed to;
(f) Ensuring that adequate resources are available for all entities in the group to effectively
implement and meet governance policies, practices and systems;
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(g) Defining the level of risk tolerance for the group, which shall be linked to the process of
determining the adequacy of the capital of the group;
(h) Establishing a system for monitoring compliance of each entity in the group with all
applicable policies, practices and systems;
(i) Requiring the risk management, compliance function and internal audit group to
conduct a periodic formal review of the group structure, their controls and activities to
assess consistency with Board approved policies, practices and strategies and to require
said groups to report the results of their assessment directly to the Board; and
(j) Disclosing to BSP all entities in the group as well as significant transactions between
entities in the group involving any BSP regulated entity.
C. Directors
A Director‘s Office is one of trust and confidence. He shall act in a manner characterized by
accountability, fairness, integrity and transparency. The Bank‘s Directors, being public
servants, are covered by the provisions of the Code of Conduct and Ethical Standards for
Public Officials and Employees (R.A. 6713) and shall, in turn, abide by their fiduciary duties
of diligence, loyalty and confidentiality.
Duties and Responsibilities of a Director
1. To remain fit and proper for the position for the duration of his/her term, which entails:
a. Possession of Qualifications and Non-Possession of Disqualifications as a continuing
requirement during the entire Term of Office under GCG Memorandum Circular No.
2012-06 and BSP Circular No. 749-2012.
b. Possession of unquestionable credibility to make decisions objectively;
c. Treatment of Board directorship as a profession; and
d. Maintenance of professional integrity and continuous enhancement of skills,
knowledge and understanding of the activities that the Bank is engaged in or intends to
pursue in the future.
2. To conduct fair business transactions with the Bank and ensure that personal interest does
not influence Board decisions including avoidance of use of position to make profit or
acquire benefit to himself and/or related interest and of situations that would give rise to
conflict of interest.
3. To devote time and attention necessary to properly discharge his duties and
responsibilities.
4. To be constantly aware of the institution‘s condition and be knowledgeable enough to
contribute meaningfully to the Board‘s work;
5. To attend and actively participate in Board and committee meetings;
6. To contribute significantly to the decision-making process of the Board;
7. To act judiciously;
8. To exercise independent judgment;
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9. To have a working knowledge of the statutory and regulatory requirements affecting the
Bank, including the contents of its Charter and By-Laws, the requirements of SEC and BSP
and, where applicable, the requirements of other regulatory agencies;
10. To observe confidentiality
11. To ensure the continuing soundness, effectiveness and adequacy of the Bank‘s control of
the environment;
12. To act honestly and in good faith, with loyalty and in the best interest of the Bank and other
stakeholders such as its depositors, investors, borrowers, other clients and the general
public; and
13. That their detailed duties and responsibilities are made available to all stakeholders and to
the public.
Independent Directors
The Bank shall maintain Independent Directors who are non-executive members and not part of
the executive committee or day to day management of banking operations. BSP Circular No.
749-2012 provides that at least twenty percent (20%) but not less than two (2) members of the
Board shall be independent directors.
In selecting independent directors, the number and types of entities where the candidate is
likewise elected as such, shall be considered to ensure that he will be able to devote sufficient
time to effectively carry-out his duties and responsibilities. For this purpose, the Independent
Director shall be required to submit a certification under oath that he/she is an Independent
Director as defined above.
An Independent Director of the Bank:
1. Is not or has not been a member of the executive committee of the Board of directors, an
officer or employee of the Bank, its subsidiaries or affiliates or related interests during
the past three (3) years counted from the date of his election;
2. Is not a director or officer of the related companies of the Bank‘s majority stockholder;
3. Is not a stockholder with shares of stock sufficient to elect one seat in the board of
directors of the Bank, or in any of its related companies or of its majority corporate
shareholders;
4. Is not a relative, within the fourth degree of consanguinity or affinity, legitimate or
common-law, of any director, officer or a stockholder holding shares of stock sufficient
to elect one seat in the Board of the Bank or any of its related companies;
5. Is not acting as a nominee or representative of any director or substantial shareholders;
and
6. Is not retained as professional adviser, consultant, agent or counsel of the Bank, any of its
related companies or any of its substantial shareholders, either in his personal capacity or
through his firm; is independent of management and free from any business or other
relationship, has not engaged and does not engage in any transaction with the Bank or
with any of its related companies or with any of its substantial shareholders, whether by
himself or with other persons or through a firm of which he is a partner or a company of
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which he is a director or substantial shareholder, other than transactions which are
conducted at arm‘s length and could not materially interfere with or influence the
exercise of his judgment.
An Independent Director of the Bank shall serve for a total of five (5) consecutive years only.
The maximum term and any ―cooling off‖ period prescribed by SEC for public and listed
companies shall apply to all Independent Directors of the Bank.
The foregoing terms and phrases used in Items ―(1) to (6)‖ above shall the following
meaning:
(a) Parent is a corporation which has control over another corporation directly or indirectly
through one (1) or more intermediaries;
(b) Subsidiary means a corporation more than fifty percent (50%) of the voting stock of
which is owned or controlled directly or indirectly through one (1) or more intermediaries
by a Bank;
(c) Affiliate is a juridical person that directly or indirectly, through one (1) or more
intermediaries, is controlled by, or is under common control with the Bank or its
affiliates;
(d) Related interests as defined under Sections 12 and 13 of R.A. No. 8791 shall mean
individuals related to each other within the fourth degree of consanguinity or affinity,
legitimate or common law, and tow (2) or more corporations owned or controlled by a
single individual or by the same family group or the same group of persons.
(e) Control exists when the parent owns directly or indirectly through subsidiaries more than
one-half of the voting power of an enterprise unless, an exceptional circumstance, it can
be clearly demonstrated that such ownership does not constitute control. Control may
also exist even when ownership of one-half or less of the voting power of an enterprise
when there is:
i. Power over more than one-half of the voting rights by virtue of an agreement with
other stockholders; or
ii. Power to govern the financial and operating policies of the enterprise under a statute or
an agreement; or
iii. Power to appoint or remove the majority of the members of the board of directors or
equivalent governing body; or
iv. Power to cast the majority votes at meetings of the board of directors or equivalent
governing body; or
v. Any other arrangement similar to any of the above.
(f) Related company means another company which is: (a) its parent or holding company;
(b) its subsidiary or affiliate; or (3) a corporation where a bank or its majority stockholder
own such number of shares that will allow/enable him to elect at least one (1) member of
the board of directors or a partnership where such majority stockholder is a partner.
(g) Substantial or major shareholder shall mean a person, whether natural or juridical,
owning such number of shares that will allow him to elect at least one (1) member of the
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board of directors of a bank or who is directly or indirectly the registered or beneficial
owner of more than ten percent (10%) of any class of its equity security.
(h) Majority stockholder or majority shareholder means a person, whether natural or
juridical, owning more than fifty percent (50%) of the voting stock of a bank.
Conduct of Board Meetings
The meeting of the Board may be conducted through modern technologies such as, but not
limited to, teleconferencing and video conferencing as long as the director who is taking part in
said meetings can actively participate in the deliberations on matters taken up therein. Provided,
that every member of the board shall participate in at least fifty percent (50%) and shall
physically attend at least twenty-five percent (25%) of all board meetings every year: Provided,
further, that in the case of a director who is unable to physically attend or participate in board
meetings via teleconferencing or video conferencing, the corporate secretary shall execute a
notarized certification attesting that said director was given the agenda materials prior to the
meeting and that his/her comments/decisions thereon were submitted for deliberations/discussion
and were taken up in the actual board meeting and that the submission of said certification shall
be considered compliance with the required fifty percent (50%) minimum attendance in board
meetings.
Multiple Board Seats
The capacity of Appointive Directors to serve with diligence shall not be compromised. As
such, no Appointive Director in a GOCC, Subsidiary or Affiliate may hold more than two (2)
other Board seats in other GOCCs, Subsidiaries and/or Affiliates.
Term of Office
1. The term of office of each Director of the Bank shall be for one (1) year starting from 1
July of the year of his appointment and expires on 30 June of the following year or for
such term and commencement thereof as may be contained in the appointment papers
issued by the Office of the President of the Philippines, unless sooner removed for cause.
Provided, however, that each Appointive Director shall continue to hold office until the
successor is appointed and qualified.
2. Appointment to any vacancy shall only be for the unexpired term of the predecessor.
Director’s Compensation, Per Diems, Allowances and Incentives
1. The compensation, per diems, allowances and incentives of the Directors shall be as
determined by the Governance Commission for GOCCs (GCG) and other supervising
agencies.
2. Directors shall not be entitled to retirement benefits.
3. Except for the per diem received for actual attendance in Board and Committee meetings
and reimbursement for actual and reasonable expenses and incentives as authorized by
the GCG, any and all unrealized profits and/or benefits including, but not limited to, the
shares in the profits, incentives of Directors or Officers in excess of that authorized y the
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GCG, stock options, dividends and other similar offers or grants from corporations where
the Bank is a stockholder or investor, and any benefit from the performance of Directors
or Officers acting for and in behalf of the Bank in dealing with its properties, investments
in other corporations, management of subsidiaries and other interests, are to be held in
trust by such Director or Officer for the exclusive benefit of the Bank.
4. Where a Director, by reason of his being a member of the Board of the Bank, acquires or
receives for himself/herself a benefit or profit of whatever kind or nature including, but
not limited to, the acquisition of shares in corporations where the Bank has an interest,
the use of properties of the Bank for his/her own benefit, the receipt of commission(s) on
contract(s) with the Bank or its assets, or the taking advantage of corporate opportunities
of the Bank, all such profits or benefits shall be subject to restitution without prejudice to
any administrative, civil or criminal action against such Director.
D. Board Officers
The Board Officers of the Bank are the Chairman of the Board (who is the highest ranking of
the Board Officers), the Vice Chairman, the Corporate Secretary, and the Compliance Officer,
who must all be Filipino citizens.
The Chairman of the Board
Under Section 31 of R. A. 6848 (Charter of the Bank), the Chairman shall be the Chief Executive
Officer of the Bank. He shall preside at all meetings of the shareholders and the Board of
Directors. Aside from those which may have been assigned to him by the Board, his powers and
duties shall include the following:
1. To execute and administer the policies, measures, orders and resolutions approved by the
Board of Directors;
2. He shall have the power and duty to execute all contracts in behalf of the Bank;
3. To enter into all necessary obligations required or permitted by the Bank‘s charter;
4. To report weekly to the Board of Directors the main facts concerning the operations
during the preceding week and suggest changes in policy or policies which will serve the
best interest of the Bank.
The Chairman‘s responsibilities include the following:
1. Calling meetings to enable the Board to perform its duties and responsibilities
2. Approving meeting agenda in consultation with the Corporate Secretary
3. Exercising control over quality, quantity and timeliness of the flow of information between
Management and the Board; and
4. Assisting in ensuring compliance with the Bank‘s guidelines on corporate governance
For legal purposes, the Chairman of the Governing Board shall be considered as the ―Head of
Agency‖ of the Bank.
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The Vice-Chairman
In the absence of the Chairman of the Board, the Vice-Chairman shall preside at the meetings
of the Board.
The Corporate Secretary
The Corporate Secretary, who must be a citizen and a resident of the Philippines, need not be a
member of the Governing Board. Ideally, the Corporate Secretary must possess organizational
and interpersonal skills and the legal skills of a Chief Legal Officer. The Corporate Secretary
shall have the following functions/duties/responsibilities:
1. Serve as an adviser to the Board Members on their responsibilities and obligations;
2. Keep the minutes of meetings of the shareholders, the Board and all other committees in a
book or books kept for that purpose, and furnish copies thereof to the Chairman and CEO
and other members of the Board as appropriate;
3. Keep in custody the seal of the Bank and affix it to any instrument requiring the same;
4. Take charge of the stock certificate book and such other books and papers as the Board
may direct;
5. Attend to the giving and serving of notices of Board and shareholder meetings, if
applicable, prepare ballots for the annual elections and keep a complete and up to date list
of the shareholders and their addresses;
6. To attest all contracts, deeds and other instruments when so ordered by the Chairman of
the Board;
7. To attest the signature of the Chairman on the stock certificates;
8. Be fully informed and be part of the scheduling process of other activities of the Board;
9. Receive instructions from the Chairman on the preparation of an annual schedule, the
calling of Board meetings, the preparation of regular agenda for meetings, and notifying the
Board of such agenda at every meeting;
10. Oversee the adequate flow of information to the Board prior to meetings;
11. Ensure fulfillment of disclosure requirements to regulatory bodies;
12. Provide GCG with sworn certifications submitted by each of the Directors and Chairman
and CEO that he/she possesses all the qualifications and none of the disqualifications
pertaining to their positions as found in the Charter or By-Laws, the provisions of laws,
rules and regulations applicable to the Bank and provided for in the Fit and Proper Rule
(GCG Memorandum Circular No. 2012-05) within 30 days after the assumption into office
of the Directors and Chairman and CEO for each new term of office.
13. Submit to the BSP, GCG and SEC at the end of every fiscal year, an annual certification as
to the attendance of the directors during Board meetings;
14. Submit to GCG the Performance Evaluation for Directors per GCG MC No. 2014-03; and
15. Such other responsibilities as the Board may impose.
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The Compliance Officer
The Governing Board of the Bank shall appoint a Compliance Officer who shall report directly
to the Chairman and CEO. Such appointment shall be subject to confirmation/approval of the
Monetary Board of BSP. The Compliance Officer shall perform the following duties:
1. Oversee the design of an appropriate compliance system of the Bank, promote its effective
implementation and address breaches that may arise there from;
2. Monitor compliance by the Bank of the requirements of R. A. No. 10149, BSP Circular No.
749-2012, the rules and regulations of the appropriate Government Agencies and
regulatory bodies, and, if any violations are found, report the matter to the Chairman of the
Board and recommend the imposition of appropriate disciplinary action on the responsible
parties and the adoption of measures to prevent a repetition of the violation;
3. Responsible for ensuring the integrity and accuracy of all documentary submissions to the
BSP, GCG and other regulatory agencies;
4. Review internal/external audit reports and other monitoring/testing reports and determine
items/exceptions which indicate deviations from or violations of laws and regulations or
any pattern which might possibly lead thereto;
5. Coordinate with individual Bank units on concerns of the Compliance Program relative to
their specific areas of responsibility;
6. Liase/coordinate with regulatory agencies (BSP, SEC, GCG, AMLC, etc.) relative to
compliance laws and regulations specific to these agencies;
7. Review laws, rules and regulations applicable to the Bank, evaluate attendant risks thereof
and formulate the necessary measures to address each concern;
8. Conduct periodic review of the Compliance Program to assess the effectiveness thereof and
identify areas that may be strengthened or revised in view of new amendments on existing
laws and regulations;
9. Render specific reports to the Board through the Audit and Compliance Committee on the
progress of and issues relative to the Compliance Program;
10. Appear before the GCG when summoned in relation to compliance with the GCG code or
other compliance issues; and
11. Issue a certification every 30 May of the year on the extent of the Bank‘s compliance with
the government corporate standards governing Banks for the period beginning 01 July of
the immediately preceding calendar year and, if there are any deviations, explain the reason
for such deviation.
12. Submit to GCG, in coordination with the Corporate Secretary, the Performance Evaluation
for Directors as prescribed by GCG MC No. 2014-03.
The appointment of the Compliance Officer shall not relieve the Governing Board of its
primary responsibility vis-à-vis the State, acting through the GCG, to ensure that the Bank has
complied with all its reportorial, monitoring and compliance obligations. Such appointment
shall be immediately disclosed to SEC on SEC Form 17-C. All correspondences relative to his
functions as such shall be addressed to the said Compliance Officer.
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E. Board Committees
The Governing Board shall create Board Committees and other such oversight bodies to enable
them to efficiently manage their time and ensure the proper understanding and resolution of all
issues affecting the Bank and the proper handling of all other concerns, and allows the Board to
effectively utilize the expertise of its Directors. These committees shall assist the Governing
Board in performing their duties and responsibilities, providing each of the committees with
written terms of reference defining their duties, authorities and the composition of the
committees constituted. The Committees shall report to the entire Board as a collegial body
and the minutes of their meetings shall be circulated to all members of the Board. The
existence of the committees shall not excuse the Board of Directors of its collective
responsibility for all matters that are within the primary responsibility and accountability of the
board.
As a minimum, the Board shall be supported by the following specialized committees:
Audit and Compliance Committee
The Audit and Compliance Committee shall be composed of at least three (3) members of the Board, at least two
(2) of whom shall be independent directors, including the chairperson, all of whom
should have accounting, auditing or related financial management expertise or experience commensurate with the
size, complexity of operations and risk profile of the Bank.
The Chairman/CEO and/or Treasurer, or officers holding equivalent positions shall not be appointed as members
of the committee.
The Audit Committee shall have the explicit authority to investigate any matter within its terms of reference, full
access to and cooperation by management and full discretion to invite any director or executive officer to attend
its meetings, and adequate resources to enable it to effectively discharge its functions. The chairmanship and
membership of the committee shall be on rotation basis for purposes of enrichment and best practices.
Upon setting up the Audit Committee, the Board of Directors shall draw up a written charter or terms of reference
which clearly sets out the Audit Committee‘s authority and duties, as well as the reporting relationships with the
Board of Directors. This charter shall be approved by the Board of Directors and reviewed and updated
periodically.
Duties and Responsibilities
The Audit and Compliance Committee provides oversight of the institution‘s financial reporting and control and
internal and external audit functions. It shall be responsible for the setting up of the internal audit department and for
the appointment of the internal auditor as well as the independent external auditor who shall both report directly to
the Audit and Compliance Committee. In cases of appointment or dismissal of external auditors, it is encouraged
that the decision be made only by independent and non-executive audit and compliance committee members. It
shall monitor and evaluate the adequacy and effectiveness of the internal control system. Its duties and
responsibilities include the following:
(1) To review and approve the audit scope and frequency, the annual internal audit plan, quarterly, semi-annual and
annual financial statements before submission to the Board, focusing on changes in accounting policies and
practices, major judgmental areas, significant adjustments resulting from the audit, going concern assumptions,
28
compliance with accounting standards, and compliance with tax, legal, regulatory and COA requirement. . It
shall receive key audit reports, internal or external, and ensure that senior management is taking necessary
corrective actions in a timely manner to address the weaknesses, non-compliance with policies, laws and
regulations and other issues identified by auditors.
(2) It shall have explicit authority to investigate any matter within its terms of reference, full access to and
cooperation by management and full discretion to invite any director or executive officer to attend its meetings,
and adequate resources to enable it to effectively discharge its functions. The Audit and Compliance
Committee shall ensure that a review of the effectiveness of the institution‘s internal controls, including
financial, operational and compliance controls, and risk management, is conducted at least annually.
(3) The Audit and Compliance Committee shall establish and maintain mechanisms by which officers and staff
shall, in confidence, raise concerns about possible improprieties or malpractices in matters of financial
reporting, internal control, auditing or other issues to persons or entities that have the power to take corrective
action. It shall ensure that arrangements are in place for the independent investigation, appropriate follow-up
action, and subsequent resolution of complaints.
(4) Overseeing, monitoring and evaluating the adequacy and effectiveness of the Bank‘s internal control system,
engage and provide oversight of the Bank‘s internal and external auditors, and coordinate with the Commission
on Audit (COA).
(5) Ensuring that internal auditors have free and full access to all the Bank‘s records, properties and personnel
relevant to and required by its function and that the internal audit activity shall be free from interference in
determining its scope, performing its work and communicating its results; and
(6) Developing a transparent financial management system that will ensure the integrity of internal control
activities throughout the Bank‘s through a procedures and policies handbook that will be used by the entire
organization.
(7) To review and discuss the following with management and auditors :
Significant financial and regulatory reporting issues, including highly complex or unusual transactions that
render the determination of their effects on the financial statements difficult or highly subjective.
Significant issues on non-compliance with Islamic Shari‘ah rules and principles
Significant changes in the selection or application of accounting principles.
Significant related party transactions not in the ordinary course of business, or with related entities that either
not audited or are audited by another firm.
Significant unadjusted audit differences.
Significant off-balance sheet structures.
(8) To review the quarterly, half-year and annual financial statements before submission to the Board.
(9) To review and approve the annual internal audit plan, the scope of audit and its frequency.
(10)To determine the overall internal auditing and compliance policies to ensure that the Offices of Internal Audit
and Compliance are vested with adequate authority to fulfill their responsibilities.
Risk Oversight Committee
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The Risk Oversight Committee shall be composed of at least three (3) members, with at least one (1) member
having a background in finance and investments and at least one (1) independent director, and a chairperson who is
a non-executive member. The members of the Risk Oversight Committee shall posses a range of expertise as well
as adequate knowledge of the institution‘s risk exposures to be able to develop appropriate strategies fro preventing
losses and minimizing the impact of losses when they occur. It shall oversee the system of limits to discretionary
authority that the board delegates to management, ensure that the system remains effective, that the limits are
observed and that immediate corrective actions are taken whenever limits are breached. The Bank‘s risk
management unit and the chief risk officer shall communicate formally and informally to the risk oversight
committee any material information relative to the discharge of its function. The risk oversight committee, shall,
where appropriate, have access to external expert advice, particularly in relation to proposed strategic transactions,
such as mergers and acquisitions.
The Chairman and CEO, the Head of Treasury and the Chief Legal Counsel shall act as members while the Risk
Officer and the Internal Auditor shall act as ―Resource Persons‖ so as not to impair their independence. All other
directors may participate as Observers.
The Chairmanship and membership of the committee shall be on rotation basis for purposes of enrichment and best
practices.
The Committee shall perform oversight risk management function specifically in areas of managing credit, market,
liquidity, operational, legal, reputation and other risks of the Bank.
The committee shall be responsible for the development and oversight of the risk management program for the
Bank, ensuring compliance with the same.
The Committee shall have a written charter that defines the duties and responsibilities of its members. The charter
shall be approved by the Board of Directors and reviewed and refined periodically.
Duties and Responsibilities
(1) Serve as catalyst in the development of an era of enhanced risk awareness and sensitivity in doing business
aligned with the requirements of Basle II. The impetus for more risk sensitivity in doing business should be
anchored more on it being a business decision rather than mere regulatory compliance;
(2) Assist in the definition of business opportunities from a risk return perspective ensuring that returns are
commensurate with risks taken consistent with the Bank‘s risk philosophy without necessarily neglecting its
developmental mandate in pre-identified areas;
(3) Oversee the adequacy and effectiveness of existing risk policies, procedures and controls including, but not
limited, to the System of Limits delegated to management, ensuring the System remains effective, adhered to
and appropriate actions are taken in case of breach;
(4) See the development of a written plan in defining the required risk management strategies in identifying,
assessing, measuring, monitoring and controlling the three (3) major risks the Bank is confronted with (i.e.
credit, market & liquidity, and operational risks), giving emphasis to the priority risk areas of concern;
(5) Identify practical strategies to reduce the chance of harm and failure or minimize losses if the risk becomes real.
(6) Ensure that plan/strategies are implemented through proper communication to concerned parties. The
Committee shall conduct regular discussions on the Bank‘s current risk exposure based on regular management
reports and call attention of concerned units/management for appropriate action in reducing these risks, if
needed;
30
(7) Identify and evaluate risk exposures and assess the probability of each risk becoming reality and shall estimate
its possible effect and cost. Priority areas of concern are those risks that are most likely to occur and are costly
when they happen.
(8) Review and revise the plan/strategies as needed to ensure its relevance, adequacy and effectiveness in the face
of changing risk exposures over time brought about by various factors (i.e. new products, economic condition,
market volatility, new regulations, etc.); and
(9) Ensure adequate separation of duties in the risk management process to avoid potential
conflicts of interest. In this light, the Committee shall see to it that risk measurement,
monitoring and control functions are sufficiently independent from position taking functions.
(10) Report regularly, or at least quarterly, to the Board the Bank‘s overall risk exposure,
actions taken to reduce the risks and recommend further action or plans as necessary as
well as ad hoc reporting and evaluation of investment proposal; and
(11) Ensure adequate separation of duties in the risk management process to avoid potential
conflict of interest, in this light, the committee shall see to it that risk measurement,
monitoring and control functions are sufficiently independent from position-taking
functions.
Corporate Governance Committee
The Governance Committee shall be composed of at least three (3) members of the Board two
(2) of whom shall be independent directors, and chaired by an Independent Director. The
membership of the committee shall be on rotation basis for purposes of enrichment and best
practices. The Governance Committee shall assist the Board of Directors in fulfilling its
corporate governance responsibilities. It shall review and evaluate the qualifications of all
persons nominated to positions requiring appointment by the Board.
Duties and Responsibilities:
(1) Ensure the Board‘s effectiveness and due observance of corporate governance principles and guidelines;
(2) Oversee the periodic performance evaluation of the Board and its Committees and Executive Management
including an annual self evaluation of the Committee‘s performance. The corporate governance committee may
coordinate with external facilitators in carrying out board assessment, within the frequency approved by the
entire board.
(3) Decide whether or not a director is able to and has been adequately carrying out his/her duties as director
bearing in mind the director‘s contribution and performance (e.g. competence, candor, attendance, preparedness
and participation). Internal guidelines shall be adopted that address the competing time commitments that are
faced when directors serve on multiple boards.
(4) Responsible for enjoining the members of the board to give priority to their attendance to the AAIIBP Board
and its committee meetings to address the competing time commitments that are faced when directors serve on
multiple boards.
(5) Make recommendations to the Board regarding the continuing education of directors, assignment to board
committees, succession plan for the Board members and senior officers, and their remuneration commensurate
with corporate and individual performance;
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(6) Make recommendation to the Board the manner by which the Board‘s performance may be evaluated and
propose an objective performance criteria approved by the Board with performance indicators which shall
address how the Board has enhanced long term shareholder‘s value;
(7) Review and update Board policies and practices on conflict of interest as defined in the Bank‘s Code of Ethics
and other applicable laws, rules and regulations.
(8) Review outside activities of senior management;
(9) Ensure that the Committee has a written charter that describes the duties and responsibilities of its members and
which has been approved by the Board and reviewed and updated at least annually; and
(10) Periodically review and update at least annually the Bank‘s Code of Ethics, the Manual on Corporate
Governance and the Charter of the Governance Committee.
F. Management
1. The Bank Officers
Chief Executive Officer (CEO)
The Bank‘s Charter provides that the Chairman of the Board shall be the Chief Executive
Officer of the Bank. In addition to his duties and responsibilities as Chairman of the Board,
the CEO shall:
a. Execute and administer the policies, measures, orders and resolutions approved by the
Board of Directors;
b. Have the power and duty to execute all contracts in behalf of the Bank;
c. Enter into all necessary obligations by this charter required or permitted;
d. Report weekly to the Board of Directors the main facts concerning the operations during
the preceding week and suggest changes in policy or policies which will serve the best
interest of the Bank
e. Submit to the Board, as soon as possible, after close of each fiscal year, a complete report
of the operations of the Bank for the preceding year and the state of its affairs;
f. Perform other duties and responsibilities that the Board may impose from time to time.
The Treasurer
Under the Bank‘s Charter, the Treasurer shall have the following powers and duties:
a. To have in his custody and be responsible for all the funds, securities of the Islamic Bank
b. To keep a complete and correct accounting of receipts, disbursements, and obligation of
the Islamic Bank
c. To disburse such funds as may be necessary for the transactions of the Islamic Bank; such
disbursements to be supported by properly accomplished receipts or vouchers; and
d. To perform all such other duties and functions as may be assigned to him by the Board of
Directors and/or the Chairman.
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The Legal Counsel
The Bank shall have a Legal Counsel who will act as the head of the Legal Department and
such shall be the chief consultant of the Islamic Bank on all legal matters. He shall submit a
monthly report to the Board of Directors on the status of cases handled by the Legal
Department.
The Internal Auditor
The Bank shall maintain an internal audit system that can reasonably assure the Board,
Management and stakeholders that its key organizational and operational controls are
faithfully complied with.
2. The Management Committees
a. Management Committee (ManCom)
The Management Committee, acting as a collegial body, is the highest collective
approving body of the Bank and shall approve matters brought to it for deliberation based
on the decision of the majority of its members.
In general, policy and operational matters that cut across sectors/departments and impact
on the whole bank will have to be presented to ManCom, including but not limited, to the
following:
i. All matters of policy, whether administrative or credit in nature, for determination of
management‘ official position, prior to Board submission and approval, e.g. personnel
policies, credit policies, exceptions to policy;
ii. All matters of policy, whether administrative or credit in nature as may be delegated by
the Board of Directors, for ManCom deliberation and approval; and
iii. Administrative or operational matters that are within the approving authorities of any
of its members but, because of their nature, would benefit from the collective wisdom
and deliberation of the ManCom as a collegial body.
b. Bank’s Credit Committee (BCC)
The BCC serves as clearing house for all credit and credit related proposals to be
approved by the Chairman and CEO or deliberated/approved by the Board.
The BCC is composed of the Head of the Branch Banking Sector, the Head of Marketing
and competent Account Officers.
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c. IT Steering Committee
The IT Steering Committee is composed of regular members of the ManCom plus the
Head of Information Technology. This committee reviews the Bank‘s IT initiatives and
spending vis-à-vis business plans and priorities. This includes the overall strategic
directions and decisions for the Bank‘s computerization projects, establishing the
business case for system development, planning principles and providing management
oversight throughout development and implementation.
d. Bids and Awards Committee (BAC)
This committee is tasked to ensure that the procurement policies and processes of the
government per R.A. #9184, as amended, and its IRRs, are fully implemented under the
principle of transparency, competitiveness, uniformity, accountability and public
monitoring. Membership to BAC is in accordance with the prescribed membership of the
IRR of R.A. #9184.
The BAC shall be primarily responsible for procurement of goods, consulting services
and contracting for infrastructure projects. It shall advertise, and/or post the invitation to
bid, conduct pre-procurement and pre-bid conferences, determine the eligibility of
prospective bidders, receive bids, conduct the evaluation of bids, undertake post-
qualification proceedings and recommend award of contracts to the Head of Agency.
The BAC also recommends sanctions in accordance with Rule XXIII; recommend the use
of Alternative Methods of Procurement and perform such other related functions as may
be necessary including the creation of a Technical Working Group (TWG) from a pool of
technical, financial, and/or legal experts to assist in the procurement process, particularly
in the eligibility screening, evaluation of bids, and post qualifications.
3. Senior Management
Senior Management shall act as the center of decision-making for the day-to-day affairs of
the Bank. The members of Senior Management shall be responsible for putting the targets
set by the Board in concrete terms and by implementing basic strategies for achieving those
targets. The duties and responsibilities of Senior Management are as follows:
a. Oversee the day-to-day management of the Bank which includes, among others:
i. Ensuring that the Bank‘s activities and operations are consistent with the Bank‘s
strategic objectives, risk strategies, corporate values and policies; and
ii. Establishing a Bank-wide management system characterized by strategically aligned
and mutually reinforcing performance standards across the Bank.
b. Responsible to the Board for implementing the infrastructure for the Bank‘s success
through the following mechanisms in its organization as set by the Board:
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i. Organizational structures that work effectively and efficiently in attaining the goals of
the Bank;
ii. Useful planning, control and risk management systems that assess the risks on an
integrated cross-functional approach;
iii. Information systems that are defined and aligned with an information technology
strategy and the business goals of the Bank; and
iv. Plan of succession that formalizes the process of identifying, training and selection
of successors in key positions in the Bank.
c. Ensure that duties are effectively delegated to the staff and to establish a management
structure that promotes accountability and transparency; and
d. Promote and strengthen check and balance systems within the Bank.
4. Chief Risk Officer
The Bank shall appoint a Chief Risk Officer who shall be independent from business line
responsibilities and revenue-generating functions but shall be part of the executive functions
and shall ensure that Risk Management functions are fully integrated into business activities.
The Chief Risk Officer shall report to the Chairman and CEO and shall have direct access to
the board of directors and the risk oversight committee without any impediment. The board
of directors shall confirm the performance ratings of the Chief Risk Officer given by the
Chairman and CEO.
The Chief Risk Officer shall have sufficient stature, authority and seniority within the bank.
He must have the ability to influence decisions that affect the Bank‘s exposure to risk. The
CRO shall have the ability, without compromising his independence to engage in discussion
with the Board of Directors, Chief Executive Officer and other Senior Management on key
risk issues and to access such information as he deems necessary to form his or her judgment.
The CRO shall meet with the Board of Directors/Risk Oversight Committee on a regular
basis and such meetings shall be duly minuted and adequately documented.
The Risk Officer shall manage a functional, independent risk organization and shall be
responsible for:
a. Ensuring that risk is managed in line with the risk appetite as defined by the Board, and
ensuring that risk parameters are advised and adhered to throughout the organization.
Identifying key risk exposures and assessing and measuring the extent of risk exposures
of the Bank.
b. Monitoring the risk exposures and determining the corresponding capital requirement in
accordance with Basel capital adequacy framework and based on the bank‘s internal
capital adequacy assessment on an ongoing basis;
c. Monitoring and assessing decisions to accept particular risks whether there are consistent
with board approved policies on risk tolerance and effectiveness of corresponding risk
mitigation measures;
35
d. Ensuring that the Bank‘s internal risk measurements cover a range of scenarios, are not
based on overly optimistic assumptions and include qualitative firm-wide views of risk
relative to return and to the Bank‘s external operating environment; and
e. Reporting on a regular basis to senior management and to the Board of Directors of the
results of assessment and monitoring.
The appointment and replacement of the Chief Risk Officer shall be with the prior approval
of the Board of Directors. In cases when the CRO will be replaced, the Bank shall report the
same to the SES of the Bangko Sentral ng Pilipinas within five (5) days from the time it has
been approved by the Board of Directors.
The Shari’ah Advisory Council
The Shari‘ah Advisory Council shall be composed of not more than five (5) members selected
from among Islamic Scholars and jurists of comparative law as provided in Section 4 of the
Charter of the Bank under RA 6848, s. 1990 that amended PD #264 and PD#542. The members
shall be elected at a general shareholder‘s meeting of the Bank every three (3) years from a list of
nominees prepared by the Board of Directors. Functions of the Shari’ah Council:
(a) To offer advice and undertake review pertaining to the application of the principles and rulings of the
Islamic Shari‘ah to the Islamic Bank transactions, but it shall not directly involve itself in the
operations of the Bank;
(b) Upon invitation, to sit in the regular or special meetings of the Board of Directors to expound his views
on matters of the Islamic Shari‘ah affecting a particular transaction but with no power to vote on the
question presented before the Board meetings.
G. External Auditor
1. The Commission on Audit shall serve as the External Auditor of the Bank and shall promote an
environment of good corporate governance as reflected in the financial records and reports of the
Bank.
2. If the external auditor believes that the statements made in the Bank‘s annual report, information
statement or proxy statement filed is incorrect or incomplete, he shall present his views in said
reports.
H. Internal Auditor
1. The Bank shall have in place an independent internal audit function which shall be performed by an
Internal Auditor or a group of Internal Auditors, through which it‘s Board, and senior management
shall be provided with reasonable assurance that its key organizational and procedural controls are
effective, appropriate, and complied with.
2. The Internal Auditor shall report to the Audit and Compliance Committee.
3. The minimum internal control mechanisms for management‘s operational responsibility shall be
centered on the CEO, being ultimately accountable for the Bank‘s organizational and procedural
controls.
36
4. The scope and particulars of a system of effective organizational and procedural controls shall be
based on the following factors: the nature and complexity of business and the business culture; the
volume, size and complexity of transactions; the degree of risk; the degree of centralization and
delegation of authority; the extent and effectiveness of information technology; and the extent of
regulatory compliance.
V
DISCLOSURE ON MATERIAL INFORMATION
The Bank shall make a disclosure on the following material information such as the bank‘s objectives,
organizational and governance structures, incentive and compensation policies, risk tolerance/appetite, adequate
information regarding the purpose, strategies, structures, risks and controls surrounding complex or non-transparent
structures or activities in which the Bank is involved and material developments that arise between regular reports,
among others, subject however to Section 33 of the AAIIBP Charter, Section 55.1 (b) of the General Banking Law
of 2000 and Section 7 of Code of Conduct and Ethical Standards for Public Officials and Employees.
A. Any Material Risk Factor and Measures Taken to Manage Such Risks
Appropriate disclosure by the Bank of the nature and extent of risks incurred in their operations requires the
establishment of sound internal risk management systems to identify, manage, control and report on risk.
Hence, Public-Private partnerships shall be adequately disclosed as such ventures are often characterized by
transfers of risks, resources and rewards between public and private partners for the provision of public
services or public infrastructure and may consequently induce new and specific material risks, including other
risks which may be detrimental to the Bank consistent with BSP‘s Risk-Based Capital Adequacy Framework
under Basel III.
B. Any Financial Assistance, including Guarantees received from the Government and Commitments made
on behalf of the Bank
To establish a fair and accurate depiction of the Bank‘s financial situation, the mutual obligations, financial
assistance or risk-sharing mechanisms between the Philippine Government and the Bank shall be appropriately
disclosed. Disclosure shall include details on any government or international grant or subsidy received by the
Bank, any guarantee granted by the Government to the Bank for its operations, as well as any commitment that
the Philippine Government undertakes on behalf of the Bank.
C. Related-Party Transactions
1. Related-Party Transactions are transactions, business deals or arrangements between two or more parties
joined by a special relationship prior to the transaction which are not illegal per se but may create actual
or potential conflicts of interest.
2. Reporting of all Related-Party Transactions shall provide all information necessary for assessing the
fairness and appropriateness of these transactions.
Implementation of this particular provision shall be subject to guidelines to be approved by the Board.
VI
COMMUNICATION PROCESS
A. This Manual shall be available for inspection by any stakeholder at reasonable hours on business days,
subject to express limitations provided by BSP, GCG, CSC, DOF and SEC Circulars, the Corporation
Code, General Banking Law and other relevant laws, circulars, rules and regulations.
37
B. All directors, executives, division and department heads are tasked to ensure the thorough dissemination of
this Manual to all employees and related third parties, and to likewise enjoin compliance in the process.
C. An adequate number of printed copies of this Manual must be reproduced under the supervision of HRM,
with a minimum of at least one (1) hard copy of the Manual per department.
VII
TRAINING PROCESS
A. An orientation program shall be conducted to operationalize this Manual.
B. A director shall, before assuming as such, be required to attend a seminar on corporate governance which
shall be conducted by a private or government institute accredited by BSP and GCG.
VIII
REPORTORIAL OR DISCLOSURE SYSTEM OF BANK’S CORPORATE GOVERNANCE POLICIES
A The reports or disclosures required under this, Manual shall be prepared arid submitted to BSP and GCC
by the responsible Committee or officer through the Bank‘s Compliance Officer.
B. All material information shall be publicly disclosed subject to the restrictions/limitations of existing laws,
regulations and Bank policies.
C. All disclosed information shall be released via the standard procedures for Bank announcements as well as
through the annual report.
IX
SHAREHOLDER’S BENEFIT
The Bank recognizes that the most cogent proof of good corporate governance is its shareholders. Therefore the
foregoing provisions are issued for the guidance of all parties concerned, as governance covenant between the
company and all its stakeholders.
At the close of each financial year, the bank shall determine the results of its operation, in the determination of
which the portion of profits due to the Bank and the investors shall be allocated pursuant to the provision of the
Bank‘s Charter.
X
MONITORING AND ASSESSMENT
A. Each Board Committee shall report regularly to the Board.
B. The Compliance Officer shall monitor compliance by all concerned of the provisions of this Manual. Any
violation thereof shall subject the responsible officer or employee to the penalty under the succeeding
section of this Manual.
C. This Manual shall be reviewed at least annually or as often as necessary. . It shall be subject to whatever
applicable rules & regulations that may later on be issued by Bangko Sentral ng Pilipinas (BSP) or GCG.
38
D. All business processes and practices being performed within any department or business unit that are not
consistent with any portion of this Manual shall be revoked unless upgraded to the compliant extent.
E. The AAIIBP Board has constituted the Governance Committee to assist it in fulfilling its
corporate governance responsibilities. Among the duties and responsibilities of the
Committee is to decide whether or not a director is able to and has been adequately carrying
out his/her duties as director bearing in mind the director‘s contribution and performance
(e.g. competence, attendance, preparedness and participation).
In pursuance of this function, AAIIBP shall adopt a peer rating system over and above the
required Performance Evaluation for Directors of GCG per GCG MC No. 2014-03, for
assessing each director‘s effectiveness which shall be approved by the Board of Directors
prior to its implementation.
I. Guidelines
1. Every January of each year or on a date decided upon by the Board, a peer
assessment of effectiveness for each Director shall be conducted using the criteria
and rating system presented in the attached form.
2. The Assessment shall cover all Appointive Directors who has served at least three
(3) months within the calendar year and has attended at least three (3) Boards and
/or Committee meetings subject of performance evaluation. It shall also cover a
Director who was appointed to a term or less than three (3) months, but has served
as Officer-In-Charge (OIC) or Acting Chairman and CEO and attended at least three
(3) Board and / or Committee meetings during the Assessment Period.
3. Performance Rating – 55%
1.1 The Rating for the Members of the Board shall be measured based on the
following:
a. Self Appraisal Rating = 15%
b. Peer Appraisal Rating = 20%
c. Chairman‘s Appraisal Rating for each Member = 20%
4. For the Chairman and CEO, the following shall be used to measure his / her Rating
Score:
a. Self Appraisal Rating = 25%
b. Peer Appraisal Rating = 30%
5. For the Board Level Committee, the following shall be used to measure the
committee‘s rating:
a. Committee Self-Appraisal Rating = 25%
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b. Chairman‘s Appraisal Rating = 30%
6. Each member of the Board shall accomplish a Self-Appraisal Form (SAF) and shall
likewise accomplish a Peer Appraisal Form for each of his /her co-member. All
members of the Board shall evaluate one another.
7. The Members of a Board-Level Committee shall accomplish a Committee Self-
Appraisal Form (CSAF) and the Average Rating shall be the Committee‘s Self-
Appraisal Rating.
8. The Chairman of the Board shall accomplish a Self-Appraisal Form (SAF), Peer
Appraisal Form (PAF) and the Committee Appraisal Form (CAF).
9. The accomplished forms shall be submitted to the Office of the Corporate Secretary
who will consolidate, compute the average rating and forward the collective Board
rating to the Chairman of the Governance Committee and to the Chairman and CEO
of the Bank.
10. It shall be the responsibility of the Office of the Corporate Secretary to furnish each
Director with the relevant documents/information for the proper accomplishment of
the assessments, such as: biodata, attendance record, etc.
II. Director Attendance Score -45%
In line with GCG Memorandum Circular 2014-03, an appointive Director must have
attended at least 75% of all authorized and duly called for Board and Committee meetings
(to which he/she is officially designated) in any given year. In determining the total
number of authorized and duly called for Board and Committee Meetings, the following
shall be observed:
(a) Attendance through teleconferencing or video conferencing in accordance with the
Securities and Exchange Commission (SEC) Memorandum Circular No. 15, 2001,
is allowed.
(b) Absences arising from the actual conduct of official business for the bank, its
subsidiary, affiliate, or for the National Government are considered excused
absence, provided, the Bank of the Appointive Director shall submit the proper
documentation of such official business, such as, but not limited to, a travel
authority; Provided further, that the total approved leaves for official business of an
Appointive director can only account for at most 10% of the total number of
authorized and duly called for Board and Committee Meetings, and any absences in
excess shall be counted against the Appointive Director.
(c) Absences arising from filial obligations shall not be considered excused, even if
approved by the Governing Board.
(d) Vacation leaves shall not be considered as excused, even if approved.
40
(e) The Office of the Corporate Secretary shall submit to the Board thru the Corporate
Governance Committee the attendance record for the year of all members of the
Governing Board.
(f) The Compliance Officer shall submit to GCG the attendance record for the year of
all members of the Governing Board.
III. Overall Grade Equivalent
Overall Score Equivalent
100% Excellent
95% to 99.99% Outstanding
85% to 94.99% Above Average
80% to 84.99% Average
70% to 79.99% Below Average
Above 60% to 69.99% Poor
60% and Below Very Poor
The Office of the Corporate Secretary / Compliance Officer will consolidate, compute the
average rating and forward the collective Board rating to the Chairman of the Governance
Committee and to the Chairman and CEO of the Bank.
IV. Rating Forms
XI
PENALTIES FOR NON-COMPLIANCE WITH THE MANUAL
To strictly observe and implement the provisions of this manual appropriate penalties shall be imposed for
violations/non-compliance with the provisions thereof after due notice and hearing in accordance with the
implementing Guidelines of existing policies and after due notice and hearing in accordance with the
Implementing Guidelines on the Revised Rules in Handling Administrative Cases of the Bank as approved per
BR No. 008-2014.
References:
1. SEC Sample Manual of Corporate Governance
a. BSP Circular No. 749 series of 2012
b. SEC Memorandum Circular No. 2 series of 2002 - Code of Corporate Governance
c. R.A. 10149- GCG Charter
(a) Self-Assessment Form - Chairman and CEO
(b) Peer Assessment Form – Chairman and CEO
(c) Self-Assessment Form- Board of Directors
(d) Peer Assessment Form- Board of Directors
(e) Board Level Committee Assessment Form
41
d. GCG Memorandum Circular No. 2012-07 – Code of Corporate Governance for GOCCs
e. GCG Memorandum Circular No. 2014-03
f. GCG Memorandum Circular 2013-02 (Re-Issued)
g. GCG Memorandum Circular 2014-03
ANNEX A
Director’s Charter of Expectations
Role Requirements
Time Commitment
The Director is expected to commit to whatever time is necessary to fulfill his duties at least ___ days per year in
addition to the ___ days expected as member of Bank Committees.
Knowledge of Bank and Committee Issues
Must have a good working and applied knowledge of concerned Bank issues relevant to discharge their obligations.
Make every effort to keep up to date with domestic and international best practice developments in the banking
industry.
Independent Decision-Making
Provide independent and objective decisions free from any interference.
Working Relationship
Establish and develop effective working relationships with management and provide support and advice while
respecting executive responsibility.
Experience
Must be experienced in the banking industry with specialization in the respective Committees to which he is
designated.
Relationship with Stakeholders
Ensure effective communication with stakeholders and ensure that members of the Board develop and maintain an
understanding of the view of management and other relevant bank issues.
42
ANNEX B
List of Disclosures for Directors
i. As provided in BSP Biographical Data
Present Positions
Present Positions in AIIBP (including membership in Bank Committees)
Present Positions in Government (including Directorships in Government Corporate Institutions
Present Positions in other Private Institutions (including Corporate Directorships)
Past Positions
Past Positions in AIIBP and duration
Past Positions in Government (including Directorships in Government Corporate Institutions) and
duration.
Past Positions in other Private Institutions (including Corporate Directorships) and duration
Family Relations (Legitimate or Common-Law)
First Degree Relatives by Consanguinity
First Degree Relatives by Affinity
Second Degree Relatives by Consanguinity
Second Degree Relatives by Affinity
Third Degree Relatives by Consanguinity
Third Degree Relatives by Affinity
II. As Stated in the Sworn Statement of Assets and Liabilities (SALN)
Business Interests and Financial Connections
43
(Of Declarant/Declarant‘s Spouse/Unmarried Children Below Eighteen (18) Years of Age Living in
Declarant‘s Household)
Relatives in the Government Service
(Within the Fourth Degree of Consanguinity or Affinity including Bilas, Balae and Inso)
Annexes C to H may be found in the separate PDF file.
ANNEX I
AUDIT AND COMPLIANCE COMMITTEE CHARTER
PURPOSE/MISSION
The Audit and Compliance Committee of the Al-Amanah Islamic Investment Bank of the
Philippines (AAIIBP) is a standing committee of the Board of Directors (Board‖).
The Purpose of the Committee is to provide oversight over:
i. the Bank‘s financial reporting policies, practices and control, and monitoring of
compliance with applicable laws, rules and regulations;
ii. the internal audit functions;
iii. the adequacy and effectiveness of the Bank‘s internal control system;
iv. the compliance functions and/or oversee the Bank‘s compliance program; and
v. the Bank‘s compliance with legal and regulatory requirements, including the
Bank‘s disclosure controls and procedures;
vi. The coordination and overall supervision of Commission on Audit (COA)
related matters.
vii. The Bank‘s compliance with the BSP Financial Consumer Protection
Framework (BSP Circular No. 857).
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While the Committee has the responsibilities and powers as set forth in this Charter, it is not the
duty of the Audit and Compliance Committee to determine the that AAIIBP‘s financial
statements and disclosures are complete and accurate and are in accordance with generally
accepted accounting principles and applicable rules and regulations. These are the
responsibilities of Management. Likewise, Management is responsible for maintaining,
monitoring and evaluating the adequacy and effectiveness of the internal control system on an
on-going basis, and for reporting on the effectiveness of internal controls on a periodic basis.
MEMBERSHIP
The Audit and Compliance Committee shall be composed of at least three (3) members of the
Board, wherein two (2) members shall be independent directors, including the Chairperson, all of
whom should have accounting, auditing or related financial management expertise or experience
commensurate with the size, complexity of operations and risk profile of the Bank.
The Chief Executive Officer, Chief Financial Officer and /or Treasurer, or officers holding
equivalent positions, shall not be appointed as members of the Audit and Compliance
Committee. The presence of majority of the members will constitute a quorum for the business
agenda and shall be valid as an act in all the meetings of the Committee.
MEETINGS
The Committee shall hold a meeting at such time and place as it considers appropriate, provided
that meeting shall be held at least once every three (3) months. Special meetings maybe
convened as necessary by the Audit and Compliance Committee Chairperson.
The Committee may invite resource persons in any of its meetings to render a report, clarity and
provide guidance to the Committee on any relevant issue.
AUTHORITY
The Audit and Compliance Committee shall have the authority to –
1. Investigate any matter within its terms and reference, to have full access to and cooperation
by Management and full discretion to invite any Director or Executive Officer to attend
its meetings, and to have full adequate resources to enable it to effectively discharge its
functions.
2. Review and approve the annual audit plan (all auditing and non-audit services) and
compliance plan and all major changes therein.
3. Review and evaluate compliance with applicable accounting principles, and to identify, with
Management and the Auditors, the accounting policies that effect on the company‘s
financial position/statements.
45
4. Ensure that a review of the institution‘s internal controls, including financial, operational and
compliance controls, and risk management, is conducted.
5. Review and discuss with Management and Auditors significant changes in the application of
accounting principles, financial/regulatory reporting issues, and audit differences.
6. Determine the overall internal auditing and compliance policies to ensure that the Officers of
Internal Audit and Compliance are vested with adequate authority to fulfill its
responsibilities.
7. Coordinate and supervise any or all COA related matters vis-à-vis the Bank, including the
creation of such appropriate Committees and their membership, as it may deem
necessary.
8. Establish a mechanism that facilitates independent investigation, appropriate follow-up and
subsequent resolution of customer complaints.
DUTIES AND RESPONSIBILITIES
The Audit and Compliance Committee shall have the following duties and responsibilities:
- Overseeing, monitoring and evaluating the adequacy and effectiveness of the Bank‘s Internal
Control System;
- Engage and provide oversight of the Bank‘s Internal and External Auditors and coordinate
with the Commission On Audit (COA).
- Review and approving audit scope and frequency of the annual internal audit plan, quarterly,
semi-annual and annual financial statements before submission to the Board, focusing on
changers in accounting policies and practices, major judgmental areas, significant
adjustments resulting from the audit, going concern assumptions, compliance with
accounting standards and compliance with tax, legal, regulatory and COA requirements.
- To receive and review reports of Internal and External auditors and regulatory agencies, and
ensuring that Management is taking appropriate corrective actions in a timely manner in
addressing control and compliance functions with regulatory agencies.
- Ensure that the internal auditors have free and full access to all the Bank‘s records, properties
and personnel relevant to and required by its function and that the internal audit activity
shall be free from interference in determining its scope, performing its work and
communicating its results.
- Develop a transparent financial Management System that will ensure the integrity of internal
control activities of the Bank through a procedures and policies handbook that will be
used by the entire organization.
- To ensure that arrangements are in place for the independent investigation, appropriate
follow-up action, and subsequent resolution of complaints.
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OTHER DUTIES AND RESPONSIBILITIES
Review and assess the adequacy of this CHARTER annually and recommend any proposed
changes for approval of the Board of Directors.
INTERRELATIONSHIP WITH OTHER UNITS
In this Charter of the Audit and Compliance Committee, the following functional
interrelationships are acknowledged –
The Integrity and Quality of the Operational Processes and Internal Control is the primary
responsibility of Management.
The Operational supervision of and oversight role over the Bank‘s Risk Management
System is the primary function of the Risk Management Officer/Risk Management
Committee.
The mechanism by which officers and staff, in confidence, raise concerns about possible
improprieties or malpractices, on matters of financial reporting, internal control, auditing
or other issues to persons or entities that have the power to take corrective action, through
the Bank‘s Whistleblower Protection Policy is the primary responsibility of the
Governance Committee which ipso facto acts as the Whistleblower Protection
Committee.
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ANNEX J
CORPORATE GOVERNANCE COMMITTEE CHARTER
PURPOSE/MISSION
The Governance Committee (the ―Committee‖) is a standing committee of the Board. The
Committee‘s purpose is to assist the Board in carrying out its oversight responsibilities to
promote the importance of adopting global principles and best practices in directing and
governing the affairs of the Bank with the end in view of maximizing its long term value for the
benefit of its stakeholders and to ensure that a culture of ethics, compliance and social
responsibility pervade in all level of banking operations.
MEMBERSHIP
The Governance Committee shall be composed of at least three (3) members of the Board, two
(2) of whom shall be independent directors, and chaired by an Independent Director. The
membership of the committee shall be on rotation basis for purposes of enrichment and best
practices.
MEETINGS
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The Committee shall hold a meeting at such time and place as it considers appropriate, provided
that meeting shall be held at least once every three (3) months. Special meetings maybe
convened as necessary by the Governance Committee Chairperson.
The Committee may invite resource persons in any of its meetings to render a report, clarity and
provide guidance to the Committee on any relevant issue.
AUTHORITY
The Governance Committee shall assist the Board in fulfilling its corporate governance
responsibilities. It shall review and evaluate the qualifications of all persons nominated to
positions requiring appointment by the Board.
DUTIES AND RESPONSIBILITIES
The Corporate Governance Committee shall have the following duties and responsibilities:
- Ensure the Board‗s effectiveness and due observance of corporate governance principles and guidelines;
- Oversee the periodic performance evaluation of the Board and its Committees and Executive Management
including an annual self evaluation of the Committee‗s performance;
- Decide whether or not a director is able to and has been adequately carrying out his/her duties as director
bearing in mind the director‗s contribution and performance (e.g. competence, candor, attendance,
preparedness and participation);
- Responsible for enjoining the members of the board to give priority to their attendance to the AAIIBP
Board and its committee meetings to address the competing time commitments that are faced when
directors serve on multiple boards.
- Make recommendations to the Board regarding the continuing education of directors, assignment to board
committees, succession plan for the Board members and senior officers, and their remuneration
commensurate with corporate and individual performance;
- Decide the manner by which the Board‗s performance may be evaluated and propose an objective
performance criteria approved by the Board with performance indicators which shall address how the
Board has enhanced long term shareholder‗s value;
- Ensure that the Committee has a written charter that describes the duties and responsibilities of its members
and which has been approved by the Board and reviewed and updated at least annually; and
- Periodically review and update at least annually the Bank‗s Code of Ethics, the Manual on Corporate
Governance and the Charter of the Governance Committee.
OTHER DUTIES AND RESPONSIBILITIES
Review and assess the adequacy of this CHARTER annually and recommend any proposed
changes for approval of the Board of Directors.
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INTERRELATIONSHIP WITH OTHER UNITS
In this Charter of the Corporate Governance, the following functional interrelationships are
acknowledged –
The Integrity and Quality of the Operational Processes and Internal Control is the primary
responsibility of Management.
The Operational supervision of and oversight role over the Bank‘s Corporate Governance
Management System is the primary function of the Corporate Governance Management
Officer/Corporate Governance Management Committee.
The mechanism by which officers and staff, in confidence, raise concerns about possible
improprieties or malpractices, on matters of financial reporting, internal control, auditing
or other issues to persons or entities that have the power to take corrective action, through
the Bank‘s Whistleblower Protection Policy is the primary responsibility of the
Governance Committee which ipso facto acts as the Whistleblower Protection
Committee.
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ANNEX K
RISK OVERSIGHT COMMITTEE CHARTER
PURPOSE/MISSION
―AAIIBP commits to develop a risk/return consciousness in the Bank with appropriate risk
management strategies geared towards loss prevention or minimization to preserve capital and
ensure adequate return on capital.‖
The Committee on Risk Management (CRM)/Risk Oversight Committee (ROC), a Board
Committee, shall be responsible for the development & oversight of the Bank's Risk
Management Program. It shall develop risk management strategies geared towards loss
prevention to preserve the Bank's capital, increase shareholder value & optimize capital
allocation for all risk-taking activities of the Bank.
MEMBERSHIP
The CRM/ROC shall be composed of at least three (3) members of the Board of Directors,
including at least one (1) independent director and a chairperson who is a non-executive
member, 1 with at least one member having a background in finance and investments.
MEETINGS
The Committee shall hold a meeting at such time and place as it considers appropriate, provided
that meeting shall be held at least once every three (3) months. Special meetings maybe
convened as necessary by the Risk Oversight Committee Chairperson.
The Committee may invite resource persons in any of its meetings to render a report, clarity and
provide guidance to the Committee on any relevant issue.
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AUTHORITY
The Risk and Oversight Committee shall have the authority to –
- Identify and evaluate risk exposures and assess the probability of each risk becoming reality
and shall estimate its possible effect and cost. Priority areas of concern are those risks
that are most likely to occur and are costly when they happen.
- Serve as catalyst in the development of an era of enhanced risk awareness and sensitivity in
doing business aligned with the requirements of Basle II. The impetus for more risk
sensitivity in doing business should be anchored more on it being a business decision
rather than mere regulatory compliance.
- Assist in the definition of business opportunities from a risk-return perspective ensuring that
returns are commensurate with risks taken consistent with the Bank‘s risk philosophy
without necessarily neglecting its developmental mandate in pre-identified areas.
- Oversee the adequacy and effectiveness of existing risk policies, procedures and controls
including, but not limited to, the System of Limits delegated to management ensuring the
system remains effective, adhered to and appropriate actions are taken in case of breach.
- See to the development of a written plan in defining the required risk management strategies
in identifying, assessing, measuring, monitoring and controlling the three (3) major risks
the Bank is confronted with, giving emphasis to the priority risk areas of concern.
- Ensure that above plans/strategies are implemented through proper communication to
concerned parties. The Committee shall conduct regular discussions on the Bank‘s
current risk exposure based on regular management reports and call attention of
concerned units/management for appropriate action in reducing these risks, if needed.
- Review and revise the plans/strategies as needed to ensure its relevancy, adequacy and
effectiveness in the face of changing risk exposures over time brought about by various
factors (i.e., new products, economic condition, market volatility, new regulations, etc.).
- Ensure adequate separation of duties in the risk management process to avoid potential
conflicts of interest. In this light, the Committee shall see to it that risk measurement,
monitoring and control functions are sufficiently independent from position-taking
functions.
DUTIES AND RESPONSIBILITIES
The Risk Oversight Committee shall have the following duties and responsibilities:
- Performing oversight risk management functions specifically in the areas of managing
Credit, market, liquidity, operational, legal, reputational and other Risks of the Bank, and
its Crisis Management, which shall include receiving from Senior Management periodic
information on risk exposures and risk management activities of the Bank.
52
- Develop the Risk Management Policy of the Bank, ensuring compliance with the same and
ensure that the risk management process and compliance are embedded throughout the
operations of the Bank especially the Board Management level.
- To provide quarterly report and update the Board on Key Risk Management issues as well
as ad hoc report and evaluate the investments proposals.
OTHER DUTIES AND RESPONSIBILITIES
Review and assess the adequacy of this CHARTER annually and recommend any proposed
changes for approval of the Board of Directors.
INTERRELATIONSHIP WITH OTHER UNITS
In this Charter of the Risk and Oversight Committee, the following functional interrelationships
are acknowledged –
The Integrity and Quality of the Operational Processes and Internal Control is the primary
responsibility of Management.
The Operational supervision of and oversight role over the Bank‘s Risk Management
System is the primary function of the Risk Management Officer/Risk Management
Committee.
The mechanism by which officers and staff, in confidence, raise concerns about possible
improprieties or malpractices, on matters of financial reporting, internal control, auditing
or other issues to persons or entities that have the power to take corrective action, through
the Bank‘s Whistleblower Protection Policy is the primary responsibility of the
Governance Committee which ipso facto acts as the Whistleblower Protection
Committee.
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ANNEX L
CODE OF ETHICS
I. DECLARATION OF PRINCIPLES
The Al-Amanah Islamic Investment Bank of the Philippines (AAIIBP) upholds the policy of the state to
promote a high standard of ethics in public service. Its members of the Board, officers and employees shall
at all times be accountable to the people and shall discharge their duties with utmost responsibility,
integrity, competence and loyalty, act with patriotism and justice, lead modest lives and uphold public
interest over personal interest (Section 2 of R.A. No. 6713 Code of Conduct and Ethical Standards for
Public Officials and Employees).
II. CORPORATE PRINCIPLES AND VALUES
A. The Duties and Obligations of the AAIIBP towards its stakeholders:
1. The Government - fulfill the special obligations that the Bank has contracted with the
Philippine government and the unequivocal support to the government‘s goal of total
growth and development consistent with the Bank‘s fiduciary duties towards its depositors,
funders and other stakeholders, with particular regard to Shari‘ah compliance.
54
2. To Depositors - provide high quality, reliable service through excellent customer relations
and offer the most appropriate products to each depositor.
3. To Shareholders – creation and growth in value, stability and long-term competitiveness.
4. To Funders - acknowledge the fiduciary nature of the funds entrusted by its funders by
administering these resources in a manner befitting their trust and respecting the lending
conditions established.
5. To Investors - provide them with competitive investment alternatives and complete
information relative thereto, that judiciously balances risks and returns.
6. To Borrowers - provide service of the highest professional standards through an efficient
system of loan processing, project management and servicing, taking into account the
complexity of the transaction. In deciding loan applications, the Bank shall balance all the
risks involved, the developmental contribution of the borrower or his project and the return
targets of the Bank.
7. To Subsidiaries - include them in the observance with the same Code of Ethics.
8. To Regulatory Agencies - provide timely and accurate reports on its operations, and
disclose to the appropriate regulatory agencies and bodies all relevant information as
required by law.
9. To Officials and Employees - enhance the quality of life of its officers and employees by
providing a competitive compensation package according to the AAIIBP Charter, provide
opportunities for training and values formation to assist them in their career path, strengthen
their commitment to excellence in public service, and cultivate their social and
environmental awareness and nationalism.
10. To Suppliers/Business Partners – provide basic services, honor of business agreements;
timely payment and cooperative efforts in all its dealings.
B. Duties and obligations of the officers and employees towards the AAIIBP. - They shall strive to render
service to their utmost best, both professionally and humanly (e.g. cooperation, teamwork). They shall
not hesitate to go beyond what is strictly demanded of them for the good of the institution.
III. NORMS OF CONDUCT
A. As public servants, all officers and employees as well as members of the Board shall observe the
following standards of personal conduct in the discharge of their duties:
1. Commitment to public interest - — to always uphold the public interest over and above
personal interest. All Bank resources and powers of their offices must be employed and
used efficiently, effectively, honestly and economically particularly to avoid wastage in
public funds and revenues.
2. Professionalism - — perform and discharge duties with the highest degree of excellence,
professionalism, intelligence and skill.
3. Fairness and Sincerity - — act with fairness and sincerity and shall not discriminate against
anyone, especially the poor and the underprivileged. Respect at all times the rights of others
and shall refrain from doing acts contrary to law, good morals, good customs, public policy,
public order, public safety and public interest.
55
4. Political Neutrality - — provide service to everyone without unfair discrimination and
regardless of party affiliation or preference.
5. Responsiveness to the public - — extend prompt, courteous, and adequate service to the
public. Unless otherwise provided by law or when required by the public interest,
employees shall provide information of the bank policies and procedures in clear and
understandable language, ensure openness of information, public consultations and hearings
wherever appropriate, encourage suggestions, simplify and systematic policy, rules and
procedures, avoid red tape and develop an understanding and appreciation of the
socioeconomic conditions prevailing in the country, especially in the depressed rural and
urban areas.
6. Nationalism and Patriotism - be loyal to the Republic and to the Filipino people, promote
the use of locally produced goods, resources and technology and encourage appreciation
and pride of country and people.
7. Commitment to Democracy -— commit to the democratic way of life and values, maintain
the principle of public accountability, and manifest by deeds the supremacy of civilian
authority over the military. Uphold at all times the Constitution and put loyalty to country
above loyalty to persons or party.
8. Simple Living - — lead modest lives appropriate to their positions and income. They shall
not indulge in extravagant or ostentatious display of wealth in any form.
IV. PROHIBITED ACTS AND TRANSACTIONS
A. In addition to the acts and omissions prescribed under existing laws, the following acts and transactions
shall constitute prohibited acts and transactions of the officers and employees:
1. Prohibited acts
a. Acceptance/Solicitation of Gifts, Donations or Loans without the Bank‘s prior approval,
to accept or solicit, either directly or indirectly, gifts from persons or entities other than
a member of his immediate family, or in behalf of any member of his family or relative
within the fourth degree of consanguinity or affinity, in the course of their official
duties or in connection with any transaction which may be affected by the functions of
their office. A ‗gift‖ includes any type of gratuity, favor, service, discount or price
concession, loan, legacy (except from a relative), fee, compensation, cash, securities,
real property, or anything of monetary value.
As to gifts or grants from foreign governments or agencies, the following may be
allowed:
i. a gift of nominal value tendered and received as a souvenir or mark of courtesy;
ii. a scholarship or fellowship grant or medical treatment;
iii. travel grants or expenses for travel taking place entirely outside the Philippines
(such as allowances, transportation, food and lodging) of more than nominal
value if such acceptance is appropriate or consistent with the interests of the
Philippines, and permitted by the Chairman or the President of the Bank.
b. Outside Activities/Employment
56
Employees are encouraged to participate in social activities with those with whom the
Bank maintains business relationships and participating occasionally in such activities
that will not violate this Code so long as they are reasonable and customary types of
social activities in a business context. However, one is prohibited to:
i. solicit for himself or for another person anything of value from anyone in return
for any business, service or confidential information of the Bank or its
customers, or
ii. accept anything of value (other than their salary or other compensation paid by
the Bank) from anyone in connection with the Bank‘s business, either before or
after a transaction is discussed or completed.
The Bank likewise supports an employee‘s participation in environmental, civil and
charitable activities so long as such participation does not encroach on the time and
attention that one is expected to devote to his duties and to the Bank. Unless previously
approved by the Bank‘s or Board, the employee must conduct such activities in a
manner that does not involve the Bank or its assets or create an appearance of Bank‘s
involvement or endorsement.
As public servants, all officers and employees are prohibited from accepting outside
employment without the Bank‘s prior approval and clearance from the Civil Service
Commission (CSC).
c. Disclosure of Confidential Information
Except as required by law, or upon order of a court of competent jurisdiction, or the
express order of the President of the Philippines or written permission of the client, no
officer or employee of the Bank shall reveal to, nor allow to be examined, inquired or
looked into, by any third person, government official, bureau or office any information
relative to details of individual accounts or specific banking transactions: Provided,
that in respect to deposits or whatever nature, the provisions of existing law shall
apply. (Section 33, AAIIBP Charter)
Additionally, officers and employees shall not use or divulge, confidential or classified
information officially known to them by reason of their office and not made available
to the public, either:
i. To further their private interests, or give undue advantage to anyone; or
ii. To prejudice the public interest
Confidential or classified information as used in this context pertain to, but not limited to
the internal operations of the bank, its customers, depositors, suppliers, competitors and
other employees accounts, except where disclosure is approved by the Bank or otherwise
legally mandated by Republic Act 1405 (Law on Secrecy of Bank Deposits) and
Republic Act 9194 (Anti-Money Laundering Act of 2001). Of special sensitivity is the
Bank‘s financial information, which should under all circumstances, be considered
confidential except when its disclosure is approved by the Bank, or when it has been
publicly available.
2. Prohibited Transactions
Conflict of Interest
57
As defined in Republic Act 6713, An Act Establishing A Code of Conduct and Ethical
Standards for Public Officials and Employees, a ―conflict of interest arises when a public
official or employee is a member of a board, an officer or a substantial stockholder of a
private corporation or owner or has a substantial interest in a business, and the interest of
such corporation or business, or his rights or duties therein, may be opposed to or affected
by the faithful performance of official duty‖. Such situation occurs when an individual‘s
private interest interferes in any way with the interests of the Bank. The Bank requires all
officials and employees to conduct personal business or outside affiliation, financial and
other relationships in a manner that will avoid, or resolve in a manner consistent with this
Code, any conflict of interest with the Bank. This prohibition extends up to the public
official‘s or employee‘s family members up to the 2 degree of consanguinity or affinity.
In all cases, conflicts of interest must be handled in an ethical manner; meaning they must
be fully disclosed to appropriate authority level in the bank and the officers and employees
concerned must resign from his position in the said private business enterprise within thirty
(30) days from his assumption of office and/or divest himself of this shareholdings, or
interest within (60) days from such assumption. Additionally, he shall inhibit himself from
transactions with conflict of interest with the Bank in whatever capacity.
V. OTHER ETHICAL CONDUCT FOR MEMBERS OF THE BOARD
AND OFFICERS
A. Other Ethical Conduct for Members of the Board:
1. Ethical Leadership/Governance
In order to demonstrate strong ethical leadership, the Board and each director shall strive to
do what is in the best interest of the Bank for the long term benefit of its shareholders and
mindful of the interests of the Bank‘s employees, customers, suppliers and other
stakeholders.
Having an oversight function over the Bank‘s operations, public disclosure and financial
reporting, the Board shall ensure transparency in disclosures of all business matters of the
Bank at all times. The Board shall promote policies that lead to a positive and ethical
workplace for the Bank‘s officers and employees and support guidelines that prohibit
retaliation against any employee who will raise issues pertaining to business conduct and
ethics.
2. Conflict of Interest/Interlocking Directorships
In order to avoid conflicts of interest and violations to the interlocking directorships rule,
members of the Board shall, at the beginning of their respective term, disclose to the Board
and BSP any interest that they may have in any corporation, partnership or association and
shall thereafter disclose any changes thereto. In the event of a conflict with respect to any
matter for discussion or resolution, wherein the Board member has a direct personal interest
or any of his relatives within the second degree of consanguinity or affinity has such
interest, the concerned director must inhibit from the deliberation on the matter. The
minutes of the meeting shall note the Board member‘s inhibition from the deliberation.
For the interlocking directorship issue, the concerned director must resign and/or divest
himself from the questioned institution except when with prior approval from the Monetary
Board or when appointed as representative of the Bank.
3. Reputation and Relationships
58
Each director shall work to protect the Bank‘s reputation and shall avoid any situation that
may be inconsistent with or that could disrupt or impair the Bank‘s relationship with its
shareholders, employees, customers and other stakeholders. Thus, directors are prohibited
from:
a. taking for themselves or members of their immediate family opportunities or
employment related to the Bank‘s except with respect to appointments of such
relatives to positions considered strictly confidential or as members of their personal
staff whose terms are co-terminus with theirs;
b. using the Bank‘s property, information, or position for the personal gain of
themselves or members of their immediate family; or
c. competing with the Bank‘s or its subsidiaries or affiliates for business opportunities.
d. either directly or indirectly, for himself and/or their respective immediate family or
as representative or agent of others, borrow any of the deposits of funds from the
Bank nor shall he become a guarantor, endorser, or surety for loans from the bank to
others, or in any manner be an obligor for money borrowed from the bank or loaned
by it. Provided, that this prohibition on loans shall not include loans allowed in the
form of fringe benefits granted in accordance with rules and regulations as may be
prescribed by the Monetary Board of the Central Bank.
e. recommend any person to any position in a private enterprise which has a regular or
pending official transaction with the Bank
f. take unfair advantage of any stakeholders of the bank through manipulation,
misrepresentation, inappropriate threats, fraud, and abuse of confidential information
or other related conduct.
g. be involved in offenses related to dishonesty or breach of trust such as-‘but not
limited to, estafa, embezzlement, extortion, forgery, malversation, swindling, theft,
robbery, falsification, violation of BP #22, violation of anti-graft and corrupt
practices and other similar offenses which could be grounds for disqualification from
being directors by the Monetary Board.
4. Confidentiality and Protection of Intellectual Property
Directors must respect the confidentiality of all confidential or proprietary information of
the Bank. Directors shall take all appropriate steps to protect the Bank‘s information and
intellectual property assets.
B. Other Ethical Conduct for Officers
1. Ethical Leadership
In addition to the compliance with the above mentioned provisions of this Code, all
AAIIBP Officers shall act with honesty and integrity in their personal and professional
relationships, avoiding actual or apparent conflicts of interest.
The term ―officer‖ shall refer to those employees defined by BSP Circular No. 562 issued
March 13, 2007 which ―include the President, Executive Vice President, Senior Vice
President, Vice President, General Manager, Treasurer, Secretary, Trust Officer and others
mentioned as officers of the bank/quasi-bank/trust entity, or those whose duties as such are
defined in the by-laws, or are generally known to be officers of the bank/quasi-bank/trust
59
entity (or any of its branches and offices other than the head office) either through
announcement, representation, publication or any kind of communication made by the
bank/quasi-bank/trust entity: Provided that a person holding the position of Chairman or
Vice Chairman of the Board or another position in the board shall not be considered as an
officer unless the duties of his position in the board include functions of management, such
as those ordinarily performed by regular officers: Provided further, That members of a
group or committee, including sub-groups or sub-committees, whose duties include
functions of management such as. those ordinarily performed by regular officers, and are
not purely recommendatory or advisory, shall likewise be considered as officers.‖
AAIIBP officers are to comply with the provisions of the Manual of Regulations for Banks
Section X145 on ―interlocking officerships and/or directorships‖, thus are prohibited to act
as concurrent officer or director with another bank or a non-bank financial intermediary,
except with prior approval from the Monetary Board or when appointed to such position as
representative of the bank.
2. Disclosure and Confidentiality of Information
AAIIBP officers shall always act in good faith, responsibly, with due care, competence and
diligence, with full disclosure of facts to supervisors. An officer is expected to respect the
confidentiality of information acquired in the course of his work to third parties except
when authorized or otherwise legally obligated to disclose it. Confidential information
acquired in the course of his work must never be used for personal advantage or to
prejudice the public interest.
3. Delegation of Responsibility and Interaction with Staff
Bank officers must exercise due care to ensure that any delegation of responsibility to
his/her staff is reasonable and appropriate in scope, and includes appropriate and continuous
monitoring. Officers are prohibited from borrowing money or property of value and/or
obtain personal favors from his/her staff that may result to negative influence in their
decisions or judgments.
4. Internal Control and Compliance
Bank officers should support the existence of an effective internal control environment and
acknowledge that he is responsible and accountable for adherence to this Code of Ethics.
Thus, they shall be role models in the strict compliance of the ethical standards provided in
this Code.
VI. GROUNDS FOR ADMINISTRATIVE DISCIPLINARY ACTION
A. Investigations for violation of this Code shall be as follows:
1. Investigation of violation of this Code by members of the Board shall be conducted by the
Governance Committee and submit its report and recommendation to the Board, without
prejudice to criminal and civil liabilities prescribed under existing laws.
2. Investigation and imposition of penalties for Violation of the Provisions of this Code by the
officers and employees shall be in accordance with the Uniform Rules on Administrative
Cases implemented under the Personnel Manual.
VII. MISCELLANEOUS PROVISIONS
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A. This code shall be reviewed as often as necessary or at least annually. Amendments to this Code shall
be submitted to the Board by the Governance Committee.
B. The Human Resource Department shall conduct seminar/workshops to promote high standard of ethics
in the Bank.
C. The Human Resource Department shall ensure that officers and employees are provided copies
of this Code.
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ANNEX M
SELF ASSESSMENT FORM
CHAIRMAN AND CEO
(strictly confidential)
Name: Evaluation Period:
Date Conducted:
Instructions:
1. Please go over the statements carefully and check/mark each sub-criteria using the following scale:
SCALE
7
6
5
4
3
2
1
CATEGORY
Excellent
Outstanding
Very Satisfactory
Satisfactory
Unsatisfactory
Poor
N/A
2. The objective of the evaluation is to assess the evaluatee's strengths and weaknesses. The rater is highly
encouraged to be forthright and to freely state the reasons for any ratings made in the Comments Section.
NOTE: Your ratings assessments are strictly confidential and are not to be discussed or
shared with anyone.
CRITERIA RATING Comments
1. Leadership Competency 1 2 3 4 5 6 7 N/A
1.1 I fully understand and communicate AAIIBPs mission,
vision and values to its stakeholders.
1.2 I translate to AAIIBP's vision and strategy into feasible
business and operational plans to achieve organizational
strategic success
1.3 I establish short-term and long-term goals and business
plans
1.4 I set clear roles and responsibilities, and establish
concrete priorities and milestones
1.5 I create new and imaginative approaches to work-
related issues
2. Managerial Competency
62
2.1 I am committed to building and maintaining AAIIBPs
achievement of its social mandate
2.2 I effectively align the bank's resources and budgets to
the implementation of AAIIBP's strategic plan.
2.3 I have timely and effectively executed strategies on
priorities and measures set by the Board
2.4 I plan and support the development of employee's skills
and abilities in fulfilling current or future job roles
effectively.
2.5 I actively identify opportunities in building strategic
relationships between one's area and other areas,
divisions, departments or organizations to help achieve
AAIIBP's social mandate
2.6 I proactively build client relationships by making efforts
to listen and understand the people being serviced by
AAIIBP.
2.7 I cascade the demands of the corporate strategy down to
the groups, departments, and support strategies fully
supportive of the priorities in the corporate strategy.
2.8 I require all heads of departments and units which are
required to specify measures, targets and initiatives
through scorecards that are reported regularly, at least a
quarterly basis.
2.9 I ensure a clear delegation of authority to senior
management and regularly review management
effectiveness.
3. Preparedness and Participation
3.1 I devote sufficient time and attention to properly
discharge and effectively perform my duties and
responsibilities as a member of the Board.
3.2 I keep myself updated on developments regarding the
Bank, including its financial and operational
performance
3.3 I have a working knowledge of the statutory and
regulatory requirements affecting AAIIBP.
3.4 I actively participate in Board discussions and
deliberations
3.5 When absent from meetings, I acquire information from
what had been discussed to stay informed.
3.6 As the Chairman of the Board, I take the lead in
contributing to strategy formulation by proposing
policies and suggesting corresponding initiatives
3.6 As the Chairman of the Board, I take the lead in the
oversight of strategy execution with particular efforts in
its monitoring and assessment
4. Board Relationship and Management
63
4.1 I work closely with the Governing Board in developing
the short, medium and long-term strategic plans of
AAIIBP.
4.2 I ensure the proper delineation of the work between the
Chairman and CEO and the Governing Board
4.3 I manage board meetings effectively and
promote/solicit participation among members of the
Governing Board
4.4 I manage the agenda of the Board meetings taking into
consideration the relevant and appropriate issues
concerning AAIIBP.
4.5 I provide the Board of Director's timely, accurate and
complete report of the operations of AAIIBP for the
preceding year
4.6 I create a sense of trustworthiness in Board of
Directors/CEO relations
4.7 I keep the Board fully informed of progress and
problems arising from strategy execution
4.8 I engage the participation of all members of the Board,
particularly in getting them to contribute to strategy
formulation and oversight of strategy execution
4.9 I establish a harmonious relationship with the members
of the Board
5. Financial Management
5.1 I have a clear, concise and timely understanding of
AAIIBPs financial statements and other pertinent
information with regard to its business and financial
situation
5.2 I exercise sound judgment in managing the financial
affairs and budget of the AAIIBP
5.3 I lay out plans to effectively monitor and evaluate the
financial planning, budget, and administrative
operations of the GOCC.
5.4 I ensure that the financial records of the AAIIBP are
accurate and above Board
6.Human Resource Management
6.1 I maintain a culture that attracts, keeps and motivates
staff to carry out AAIIBPs strategic goals and
objectives.
6.2 I foster support and stewardship for employees
initiatives and creativity within the organization
6.3 I recruit competent management team with skills
commensurate with the position
7. Product/Service Competency
7.1 I have a high understanding and knowledge of AAIIBPs
products and services
7.2 I have a good understanding of AAIIBPs business
model as well as its business and industry environment
64
7.3 I regularly encourage and initiate creativeness in
developing new products and services
8. External Relations
8.1 I handle public relation issues in a manner that builds
goodwill for AAIIBP and lessens issues / concerns from
the general public
8.2 I encourage corporate social responsibility to promote a
positive image of AAIIBP as well as create awareness
of available products and services to the general public
8.3 As a Chairman and CEO, I serve as an effective
AAIIBP representative on communicating the bank's
products and services to all stakeholders, including the
general public
9.Teamwork and Communication
9.1 I actively establish and maintain good personal relations
with co-directors and management
9.2 I handle work conflict positively and constructively
9.3 I listen attentively to the contribution of others
9.4 I explore differences of opinion in a positive way.
9.5 I maintain objectivity in the face of difficult decisions
9. Conduct / Behavior
9.1 I act in a manner characterized by transparency,
accountability, integrity and fairness fully aware that
the position of a Chairman and CEO is one of trust and
confidence
9.2 I ensure the confidentiality of business information
acquired by reason of my position as Chairman and
CEO and our board's deliberation
9.3 I ensure that my personal interest do not conflict with
the interest of AAIIBP.
9.4 I treat others within the bank with courtesy and respect
OTHER COMMENTS/OBSERVATIONS TO FURTHER IMPROVE MY PERFORMANCE
EVALUATOR'S SIGNATURE:
65
PEER ASSESSMENT FORM
CHAIRMAN AND CEO
(strictly confidential)
Director Being Evaluated: Evaluated By:
Date Conducted: Evaluation Period:
Instructions:
1. Please go over the statements carefully and check/mark each sub-criteria using the following scale:
SCALE CATEGORY
7 Excellent
6 Outstanding
5 Very Satisfactory
4 Satisfactory
3 Unsatisfactory
2 Poor
1 N/A
2. The objective of the evaluation is to assess the evaluatee's strengths and weaknesses. The rater is highly
encouraged to be forthright and to freely state the reasons for any ratings made in the Comments Section.
NOTE: Your ratings assessments are strictly confidential and are not to be discussed or shared with anyone.
CRITERIA RATING Comments
1. Leadership Competency 1 2 3 4 5 6 7 N/A
1.1 Fully understands and communicates AAIIBPs
mission, vision and values to its stakeholders.
1.2 Translates AAIIBP's vision and strategy into feasible
business and operational plans to achieve
organizational strategic success
1.3 Establishes short-term and long-term goals and
business plans
1.4 Sets clear roles and responsibilities, and establish
concrete priorities and milestones
1.5 Creates new and imaginative approaches to work-
related issues
2. Managerial Competency
2.1 Committed to building and maintaining AAIIBPs
achievement of its social mandate
2.2 Effectively aligns the bank's resources and budgets to
the implementation of AAIIBP's strategic plan.
2.3 Timely and effectively executed strategies on priorities
and measures set by the Board.
66
2.4 Plans and supports the development of employee's
skills and abilities in fulfilling current or future job
roles effectively.
2.5 Actively identifies opportunities in building strategic
relationships between one's area and other areas,
divisions, departments or organizations to help achieve
AAIIBP's social mandate
2.6 Proactively builds client relationships by making
efforts to listen and understand the people being
serviced by AAIIBP.
2.7 Cascades the demands of the corporate strategy down
to the groups, departments, and support strategies fully
supportive of the priorities in the corporate strategy.
2.8 Requires all heads of departments and units which are
required to specify measures, targets and initiatives
through scorecards that are reported regularly, at least a
quarterly basis.
2.9 Ensures a clear delegation of authority to senior
management and regularly review management
effectiveness.
3. Preparedness and Participation
3.1 Devotes sufficient time and attention to properly
discharge and effectively perform my duties and
responsibilities as a member of the Board.
3.2 Is updated on developments regarding the Bank,
including its financial and operational performance
3.3 Has working knowledge of the statutory and regulatory
requirements affecting AAIIBP.
3.4 Actively participates in Board discussions and
deliberations
3.5 When absent from meetings, acquires information from
what had been discussed to stay informed.
3.6 As the Chairman of the Board, takes the lead in
contributing to strategy formulation by proposing
policies and suggesting corresponding initiatives
3.6 As the Chairman of the Board, takes the lead in the
oversight of strategy execution with particular efforts in
its monitoring and assessment
4. Board Relationship and Management
4.1 Works closely with the Governing Board in developing
the short, medium and long-term strategic plans of
AAIIBP.
4.2 Ensures the proper delineation of the work between the
Chairman and CEO and the Governing Board
4.3 Manages board meetings effectively and
promote/solicit participation among members of the
Governing Board
67
4.4 Manages the agenda of the Board meetings taking into
consideration the relevant and appropriate issues
concerning AAIIBP.
4.5 Provides the Board of Director's timely, accurate and
complete report of the operations of AAIIBP for the
preceding year
4.6 Creates a sense of trustworthiness in Board of
Directors/CEO relations
4.7 Keeps the Board fully informed of progress and
problems arising from strategy execution
4.8 Engages the participation of all members of the Board,
particularly in getting them to contribute to strategy
formulation and oversight of strategy execution
4.9 Establishes a harmonious relationship with the
members of the Board
5. Financial Management
5.1 Has a clear, concise and timely understanding of
AAIIBPs financial statements and other pertinent
information with regard to its business and financial
situation
5.2 Exercises sound judgment in managing the financial
affairs and budget of the AAIIBP
5.3 Lays out plans to effectively monitor and evaluate the
financial planning, budget, and administrative
operations of the GOCC.
5.4 Ensures that the financial records of the AAIIBP are
accurate and above Board
6.Human Resource Management
6.1 Maintains a culture that attracts, keeps and motivates
staff to carry out AAIIBPs strategic goals and
objectives.
6.2 Fosters support and stewardship for employees
initiatives and creativity within the organization
6.3 Recruits competent management team with skills
commensurate with the position
7. Product/Service Competency
7.1 Has a high understanding and knowledge of AAIIBPs
products and services
7.2 Has a good understanding of AAIIBPs business model
as well as its business and industry environment
7.3 Shown to encourage and initiate creativeness in
developing new products and services
8. External Relations
8.1 Handles public relation issues in a manner that builds
goodwill for AAIIBP and lessens issues / concerns
from the general public
68
8.2 Encourages corporate social responsibility to promote a
positive image of AAIIBP as well as create awareness
of available products and services to the general public
8.3 Serves as an effective AAIIBP representative on
communicating the bank's products and services to all
stakeholders, including the general public
9.Teamwork and Communication
9.1 Actively establishes and maintains good personal
relations with co-directors and management
9.2 Handles work conflict positively and constructively
9.3 Listens attentively to the contribution of others
9.4 Explores differences of opinion in a positive way.
9.5 Maintains objectivity in the face of difficult decisions
9. Conduct / Behavior
9.1 Acts in a manner characterized by transparency,
accountability, integrity and fairness fully aware that
the position of a Chairman and CEO is one of trust and
confidence
9.2 Ensures the confidentiality of business information
acquired by reason of my position as Chairman and
CEO and our board's deliberation
9.3 Ensures that personal interest do not conflict with the
interest of AAIIBP.
9.4 Treats others within the bank with courtesy and respect
OTHER COMMENTS/OBSERVATIONS TO FURTHER IMPROVE MY PERFORMANCE
EVALUATOR'S SIGNATURE:
69
SELF ASSESSMENT FORM
BOARD OF DIRECTORS
(strictly confidential)
Name: Evaluation Period:
Date Conducted:
Instructions:
1. Please go over the statements carefully and check/mark each sub-criteria using the following scale:
SCALE CATEGORY
7 Excellent
6 Outstanding
5 Very Satisfactory
4 Satisfactory
3 Unsatisfactory
2 Poor
1 N/A
2. The objective of the evaluation is to assess the evaluatee's strengths and weaknesses. The rater is highly
encouraged to be forthright and to freely state the reasons for any ratings made in the Comments Section.
NOTE: Your ratings assessments are strictly confidential and are not to be discussed or shared with anyone.
CRITERIA RATING Comments
1. Knowledge and Personal Development 1 2 3 4 5 6 7 N/A
1.1 I understand the mission, vision, and values of the
GOCC
1.2 I understand my duties and responsibilities as a director,
including the distinction between Board and
management roles.
1.3 I understand the general economic, social and business
industry issues that affects AAIIBP.
1.4 I willingly participate in director development activities
(e.g. seminars, trainings, etc)
1.5 I am open to feedback about my performance.
2. Preparedness and Participation
2.1 I devote sufficient time and attention to properly
discharge and effectively perform my duties and
responsibilities as a member of the Board.
2.2 I keep myself updated on developments regarding the
Bank, including its financial and operational
performance
70
2.3 I have a working knowledge of the statutory and
regulatory requirements affecting AAIIBP.
2.4 I actively participate in Board discussions and
deliberations
2.5 When absent from meetings, I acquire information from
what had been discussed to stay informed.
2.6 I contribute to strategy formulation by proposing
policies and suggesting corresponding initiatives.
( please indicate specific policies / initiatives proposed)
2.7 I am involved in the oversight of strategy execution
with particular efforts in its monitoring and assessment
( please indicate specific policies / initiatives proposed)
9.Teamwork and Communication
9.1 I actively establish and maintain good personal relations
with co-directors and management
9.2 I handle work conflict positively and constructively
9.3 I listen attentively to the contribution of others
9.4 I explore differences of opinion in a positive way.
9.5 I maintain objectivity in the face of difficult decisions
9. Conduct / Behavior
9.1 I act in a manner characterized by transparency,
accountability, integrity and fairness fully aware that
the position of a Director is one of trust and confidence
9.2 I ensure the confidentiality of business information
acquired by reason of my position as Director and our
board's deliberation
9.3 I ensure that my personal interest do not conflict with
the interest of AAIIBP.
9.4 I treat others within the bank with courtesy and respect
OTHER COMMENTS/OBSERVATIONS TO FURTHER IMPROVE MY PERFORMANCE
EVALUATOR'S SIGNATURE:
71
PEER ASSESSMENT FORM
BOARD OF DIRECTORS
(strictly confidential)
Director Being Evaluated: Evaluated By:
Date Conducted: Evaluation Period:
Instructions:
1. Please go over the statements carefully and check/mark each sub-criteria using the following scale:
SCALE CATEGORY
7 Excellent
6 Outstanding
5 Very Satisfactory
4 Satisfactory
3 Unsatisfactory
2 Poor
1 N/A
2. The objective of the evaluation is to assess the evaluatee's strengths and weaknesses. The rater is highly
encouraged to be forthright and to freely state the reasons for any ratings made in the Comments Section.
NOTE: Your ratings assessments are strictly confidential and are not to be discussed or shared with anyone.
CRITERIA RATING Comments
1. Knowledge and Personal Development 1 2 3 4 5 6 7 N/A
1.1 Understands the mission, vision, and values of the
GOCC
1.2 Understands the duties and responsibilities as a director,
including the distinction between Board and
management roles.
1.3 Understands the general economic, social and business
industry issues that affect AAIIBP.
1.4 Willingness to participate in director development
activities (e.g. seminars, trainings, etc)
1.5 Is open to feedback about his/her performance.
2. Preparedness and Participation
2.1 Devotes sufficient time and attention to properly
discharge and effectively perform my duties and
responsibilities as a member of the Board.
2.2 Is updated on developments regarding the Bank,
including its financial and operational performance
72
2.3 Has working knowledge of the statutory and regulatory
requirements affecting AAIIBP.
2.4 Actively participates in Board discussions and
deliberations
2.5 When absent from meetings, I acquire information from
what had been discussed to stay informed.
2.6 Contributes to strategy formulation by proposing
policies and suggesting corresponding initiatives.
2.7 Is involved in the oversight of strategy execution with
particular efforts in its monitoring and assessment
9.Teamwork and Communication
9.1 Actively establishes and maintain good personal
relations with co-directors and management
9.2 Handles work conflict positively and constructively
9.3 Listens attentively to the contribution of others
9.4 Explores differences of opinion in a positive way.
9.5 Maintains objectivity in the face of difficult decisions
9. Conduct / Behavior
9.1 Act in a manner characterized by transparency,
accountability, integrity and fairness fully aware that
the position of a Director is one of trust and confidence
9.2 Ensures the confidentiality of business information
acquired by reason of my position as Director and our
board's deliberation
9.3 Ensures that my personal interest do not conflict with
the interest of AAIIBP.
9.4 Treats others within the bank with courtesy and respect
OTHER COMMENTS/OBSERVATIONS TO FURTHER IMPROVE MY PERFORMANCE
EVALUATOR'S SIGNATURE:
73
BOARD LEVEL COMMITTEE ASSESSMENT FORM
______________________________________
( Committee being evaluated)
(strictly confidential)
Director Being Evaluated: Evaluated By:
Date Conducted: Evaluation Period:
Instructions:
1. Please go over the statements carefully and check/mark each sub-criteria using the following scale:
SCALE CATEGORY
7 Excellent
6 Outstanding
5 Very Satisfactory
4 Satisfactory
3 Unsatisfactory
2 Poor
1 N/A
2. The objective of the evaluation is to assess the evaluatee's strengths and weaknesses. The rater is highly
encouraged to be forthright and to freely state the reasons for any ratings made in the Comments Section.
NOTE: Your ratings assessments are strictly confidential and are not to be discussed or shared with anyone.
CRITERIA RATING Comments
1. Knowledge and Personal Development 1 2 3 4 5 6 7 N/A
1.1 Understands the ____________ Committee Charter and
the duties and responsibilities of the committee
1.2 Demonstrates appropriate industry knowledge and
includes a diversity of experiences and backgrounds
1.3 Members of the _________committee meet all
applicable independence requirements
1.4 Willingness to participate in director development
activities (e.g. seminars, trainings, etc)
1.5 Is open to feedback about performance.
2. Preparedness and Participation
2.1 Devotes sufficient time and attention to properly
discharge and effectively perform duties and
responsibilities as the Chairman _______________
Committee
74
2.2 Is updated on developments regarding the Bank,
including its financial and operational performance
2.3 Has working knowledge of the statutory and regulatory
requirements affecting AAIIBP.
2.4 Actively participates in the Committees discussions
and deliberations
2.5 When absent from meetings, acquires information from
what had been discussed to stay informed.
2.6 Contributes to strategy formulation by proposing
policies and suggesting corresponding initiatives.
2.7 Reviews its charter annually to determine whether its
responsibilities are described adequately and
recommends changes to the board for approval.
2.8 Is involved in the oversight of strategy execution with
particular efforts in its monitoring and assessment
2.9 The Committee meetings are conducted effectively,
with sufficient time spent on significant or emerging
issues.
2.1 Is involved in the oversight of strategy execution with
particular efforts in its monitoring and assessment
3.Teamwork and Communication
3.1 Actively establishes and maintain good personal
relations with committee members
3.2 Handles work conflict positively and constructively
3.3 Listens attentively to the contribution of others
3.4 Explores differences of opinion in a positive way.
3.5 Maintains objectivity in the face of difficult decisions
4. Conduct / Behavior
4.1 Act in a manner characterized by transparency,
accountability, integrity and fairness fully aware that
the position of a Director is one of trust and confidence
4.2 Ensures the confidentiality of business information
acquired by reason of my position as Director and our
board's deliberation
4.3 Ensures that my personal interest do not conflict with
the interest of AAIIBP.
4.4 Treats others within the bank with courtesy and respect
OTHER COMMENTS/OBSERVATIONS TO FURTHER IMPROVE MY PERFORMANCE
75
EVALUATOR'S SIGNATURE: