AIB Committees
The principal role of the committee is to establish compensation policy for the Chief Executive Officer, members of the Management Board, and other senior managers. These guidelines include base salary, bonus, and fringe benefits. The committee also reviews the performance of senior management through a formal goal-setting and monitoring mechanism. Yearly bonuses are established based on the Bank’s financial performance against the annual budget and individual management achievement of their goals. The committee also reviews human resource policies and procedures for employees.
In 2012, the role of the committee was expanded to include primary responsibility for the recruitment of independent board members and the Chief Executive Officer whenever required. The committee has also worked with the Management Board to broaden senior executives’ appraisals to include a review of attributes to ensure that performance expectations extend beyond just financial performance.
The committee reports to the Board and shareholders on the targets, goals, and performance of management as well as proposed changes to the compensation structure and policies and procedures. The contracts for the Chief Executive Officer and independent directors are also determined by the committee and reported to the Board and shareholders.
The principal role of the committee is to review the Bank’s risk exposure under different products. This encompasses foreign exchange positions, asset and liabilities, capital adequacy, credit and market risk, and sovereign risk. The committee also reviews performance of the classified and non-performing loan portfolio and, most importantly, reviews and submits to the Board of Supervisors all the Bank’s policies associated with risk management. Finally, the Committee identifies unacceptable risk conditions to the full Board for its consideration and action.
During 2012, the committee approved the liquidity policy of the Bank, established guidelines for the investment of surplus funds, and developed a strategy for lending. The committee, working with management, oversaw the restructuring of the loan portfolio in light of risk conditions in Afghanistan.
The committee held its inaugural meeting in November, where it discussed preliminary planning scenarios for post-2014 and reviewed the proposed budget and business plan for 2013.
The committee’s mandate covers allocation of funds to a portfolio of fixed income bonds and securities, and oversight of such investments. Its principal role is to oversee the Bank’s investment policy and to ensure it is modified and executed appropriately in the context of the Bank’s risk and capital parameters.
The committee works with the Board to set investment policy, approve investment of the Bank’s funds, and monitor the mandate and performance of independent asset managers hired by the Bank. It seeks approval from the full Board when required and highlights issues that require attention.
During the year, the committee selected Julius Baer to manage a portfolio of fixed income securities in addition to Emirates NBD.
The Audit Committee is responsible for overseeing financial reporting, compliance with risk management policies and procedures, internal controls, compliance, ethics, and management and functioning of internal audit. It is also responsible for maintaining an appropriate relationship with the external auditors and meets with them on the completion of the annual audit and quarterly reviews.
Meetings are usually held four times a year (as in 2012) in person and in conjunction with Board meetings. The meetings are attended by the Chief Executive, Head of Internal Audit, and appropriate Management Board members. Minutes are presented at the next Board meeting when the committee chairman reports on issues requiring Board attention.
Compensation Committee
The Compensation Committee comprises three directors, two of whom, including the chairperson, are independent. Its members are Veronica John (Chairperson), Ronald Stride, and Hamidullah A. Mohib.The principal role of the committee is to establish compensation policy for the Chief Executive Officer, members of the Management Board, and other senior managers. These guidelines include base salary, bonus, and fringe benefits. The committee also reviews the performance of senior management through a formal goal-setting and monitoring mechanism. Yearly bonuses are established based on the Bank’s financial performance against the annual budget and individual management achievement of their goals. The committee also reviews human resource policies and procedures for employees.
In 2012, the role of the committee was expanded to include primary responsibility for the recruitment of independent board members and the Chief Executive Officer whenever required. The committee has also worked with the Management Board to broaden senior executives’ appraisals to include a review of attributes to ensure that performance expectations extend beyond just financial performance.
The committee reports to the Board and shareholders on the targets, goals, and performance of management as well as proposed changes to the compensation structure and policies and procedures. The contracts for the Chief Executive Officer and independent directors are also determined by the committee and reported to the Board and shareholders.
Risk Committee
The Board’s committee to provide comprehensive oversight and best practices in risk governance and risk management comprises Hasib Ahmed (Chairman), Hamidullah A. Mohib, and two independent Board members – Ronald Stride and Aditya Srivastava.The principal role of the committee is to review the Bank’s risk exposure under different products. This encompasses foreign exchange positions, asset and liabilities, capital adequacy, credit and market risk, and sovereign risk. The committee also reviews performance of the classified and non-performing loan portfolio and, most importantly, reviews and submits to the Board of Supervisors all the Bank’s policies associated with risk management. Finally, the Committee identifies unacceptable risk conditions to the full Board for its consideration and action.
During 2012, the committee approved the liquidity policy of the Bank, established guidelines for the investment of surplus funds, and developed a strategy for lending. The committee, working with management, oversaw the restructuring of the loan portfolio in light of risk conditions in Afghanistan.
Strategy and Planning Committee
The Strategy and Planning Committee’s mission is to provide oversight to AIB’s strategic planning and annual budgeting and planning processes, as well as the development of major new initiatives. Its members are: Brian Dickie (Chairman), Ronald Stride (both independent directors), Lutfullah Rahmat, and Hasib Ahmed.The committee held its inaugural meeting in November, where it discussed preliminary planning scenarios for post-2014 and reviewed the proposed budget and business plan for 2013.
Investment Committee
The Investment Committee comprises three directors – Salman Shoaib (Chairman and independent director), Hasib Ahmed, and Gokhal Erkan. The committee held its inaugural meeting in November.The committee’s mandate covers allocation of funds to a portfolio of fixed income bonds and securities, and oversight of such investments. Its principal role is to oversee the Bank’s investment policy and to ensure it is modified and executed appropriately in the context of the Bank’s risk and capital parameters.
The committee works with the Board to set investment policy, approve investment of the Bank’s funds, and monitor the mandate and performance of independent asset managers hired by the Bank. It seeks approval from the full Board when required and highlights issues that require attention.
During the year, the committee selected Julius Baer to manage a portfolio of fixed income securities in addition to Emirates NBD.
Audit Committee
The Audit Committee is established under the Banking Act in Afghanistan. The committee reports directly to the shareholders and the Bank’s chairman, and its members are appointed at the annual general meeting. Appointments are for not more than four years and may be renewed for like periods. Members of the Board of Supervisors or the Management Board may not serve on the Audit Committee. Members of the committee are subject to the same fit and proper requirements as members of the Board of Supervisors. In 2012 the committee had five members, all qualified and experienced in accounting or banking.The Audit Committee is responsible for overseeing financial reporting, compliance with risk management policies and procedures, internal controls, compliance, ethics, and management and functioning of internal audit. It is also responsible for maintaining an appropriate relationship with the external auditors and meets with them on the completion of the annual audit and quarterly reviews.
Meetings are usually held four times a year (as in 2012) in person and in conjunction with Board meetings. The meetings are attended by the Chief Executive, Head of Internal Audit, and appropriate Management Board members. Minutes are presented at the next Board meeting when the committee chairman reports on issues requiring Board attention.