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PRA consults on good board governance for PRA-regulated firms

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27 May 2015

The Prudential Regulation Authority (PRA) has published a consultation paper seeking views on a draft supervisory statement which looks to identify some key aspects of good board governance for boards to consider and to which the Prudential Regulation Authority (PRA) pays close attention in the conduct of its supervision.

The consultation paper CP 18/15 Corporate Governance: Board responsibilities is relevant for all PRA-regulated firms and provides guidance on the PRA’s expectations relating to:

  • Setting strategy
  • Culture
  • Risk appetite and risk management
  • Board composition
  • The respective roles of executive and non-executive directors
  • Knowledge and experience of non-executive directors
  • Board time and resources
  • Management information and transparency
  • Succession planning
  • Remuneration
  • Subsidiary boards
  • Board committees

The PRA indicate that the draft supervisory statement is not intended to be a comprehensive guide to good corporate governance with such guidance being contained within other sources such as the Financial Reporting Council’s UK Corporate Governance Code and the Corporate Governance Principles for Banks, published by the Basel Committee on Banking Supervision.

Comments on the draft supervisory statement are requested by 14 September 2015.

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