Governance cooperative banks

What is governance in a bank?
By governance we mean broadly the oversight that comes from banks' own shareholders and other stakeholders of the way in which they are run.
The problem of bank governance stems from the way in which banks are financed and regulated, from the externalities bank failures produce, and from the nature of their assets..
The bank's board is responsible for overseeing the management of the bank's compliance risk.
The board should establish an independent compliance function and approve the bank's policies and processes for identifying, assessing, monitoring and reporting, and advising on compliance risk.

Apr 8, 2020When you ask a member of any cooperative bank what it is that makes the model unique, the immediate answer is: “governance”.

As cooperatives with customers, these banks have a governance system that means clients can be elected to governing bodies. In this system, financial expertise comes second to members' interests.

2 Autonomy

Autonomy is another important principle that goes hand in hand with democracy. Nevertheless, it appears to be a concept better adapted to decentralized struct…

3 Accountability

The principle of autonomy, and the freedom of management that comes with it, gives rise to another principle: accountability. Cooperative employees, manag…

4 Non-Monetary Compensation and Recognition

In many cooperative banks, financial incentives are usually not directly tied to results. Bonuses do exist, but they are only paid once the fiscal year i…

5 Territorial Entrenchment

Territorial entrenchment is another specific principle of cooperative banks, and it is recognized as guaranteeing proximity to members and cust…

What are the corporate governance norms for commercial banks?

The Corporate Governance norms in vogue for Commercial Banks are based on Clause 49 of the SEBI Listing of Companies and the OECD principles

Further the Basle Report on Guide to Corporate Governance Principles – BIS in July 2015, is also available for guidance

What is a cooperative bank?

Cooperative banks exhibit a particular governance, because they consist of multiple locally anchored banks often collaborating in a larger cooperative banking group

Moreover, their core business is in retailing banking focussing on a close relationship to their customers

What is corporate governance & management in cooperative banks?

Corporate Governance and Management in Cooperative Banks Corporate Governance, in general, identifies issues and challenges relating to employees, customers, stakeholders, financial institutions, Government, media, etc

to work towards a balanced approach to Business

This applies to all types of organisations and institutions

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