The Bank of Ghana(BoG) is set to introduce a new rule that will prevent Chief Executive Officers and Managing Directors of banks in the country from holding the positions for more than fifteen years.
The new rule if introduced will affect some CEOs in the banking industry who have held the position for over fifteen years.
Speaking at the Launch of a Bank of Ghana partnership with the International Finance Corporation, the Second Deputy Governor of the Bank of Ghana, Dr. Johnson Asiama disclosed that the new rule will also bar foreign banks from concurrently occupying the Managing Director position, as well as Board Chair position.
“The tenure of CEOs will be capped at a maximum of three terms of five years per term, secondly non-executive directors shall have a tenure of three years for no more than two terms and shall be in the majority of every board,”Dr. Asiama stressed.
He added that “at the minimum, every bank shall have at least two board sub-committee specifically on audit and risk”.
“Fourthly the risk and audit committees shall be chaired by non-executive director. Fifth the non executive director’s independence has been explicitly defined,” he said.
He disclosed that the Managing Director and Board Chair positions of foreign banks cannot be occupied concurrently.
Outlining some more provisions in a reviewed document drafted by the international Finance Corporation (IFC) with e BoG, Dr. Asiama stated that competencies for board membership of banks shall be explicitly defined in accordance with Basel requirements.
“The size of bank’s board shall be limited as well as the retiring age for directors prescribed. Nine, disclosure of attendance at board meetings by directors in annual accounts shall be enforced,” he said adding that cross directorship will be discouraged
He stated that another important area of the document is that additional directorship engagement will be limited to no more than five, while evaluation of individual directors performance and collective performance by external agents shall be enforced.
IFC upholds accountability
Meanwhile, a Senior Country Officer of the IFC, Joseph Akwasi Kuma told Citi Business News Ghana’s banking sector needs Good Corporate Governance to reassure international investors of transparency.
According to him, it is important to have people with integrity in the banking sector.
By: Lawrence Segbefia/citibusinessnews.com/Ghana