BAKU, Azerbaijan, October 2. Azerbaijani banks are required to prepare a new strategic plan following the "Corporate governance standards for banks" approved by the Central Bank of Azerbaijan (CBA) and submit it to the CBA by the end of March next year, Trend reports.
According to the CBA, the banks must also assess the level of implementation of the standards every three months and report their results to the CBA.
"As stated in the requirements of the Basel Committee on Banking Supervision, the application of effective corporate governance requirements is necessary for overall financial stability and for ensuring risk-oriented banking activities," the CBA said.
"In connection with this, the decision of the Board of Directors of the CBA dated August 28, 2023, adopted the "Corporate governance standards for banks," which came into force on September 8. The main goal of adopting these standards is to ensure their operation in accordance with the principles of reliability, transparency, accountability, and responsibility by clearly defining the powers and responsibilities of the governing bodies of banks," the CBA added.
Prior to the adoption of the new standards, regulatory requirements for corporate governance standards in banks were governed by the "Corporate governance standards for banks," the "Rules for risk management in banks", and the "Rules for the organization of internal control and internal audit in banks".
The first two of the above regulatory acts were adopted in 2013, and in 2019, the abolished Financial Market Supervisory Authority made certain changes to these rules. The rules for internal control and audit were adopted in 1999, and since then, only technical changes were made to them.