1. Corporate Governance Landscape

Corporate governance refers to a system through which institutions are managed and controlled. Its presence facilitates the achievement of business objectives and ensures the protection of all stakeholders’ interests including the Board, senior management and clients.

In the financial industry, the need for good corporate governance is of paramount importance and, at Saradar we know this very well. That’s why we shed no effort in enforcing a system that guarantees trust in the way we operate and that strengthens the public confidence in the financial system that we’re proudly part of.

A-Corporate Governance at Saradar

In addition to Board and management oversight, we have created effective systems, processes, policies and procedures that ensure compliance with laws and central bank regulations, protect the bank’s interests and our stakeholders whilst providing a fertile ground for growth.

To this end, we follow the highest standards in the industry and we work diligently on improving them by the day. Beyond the written standards, we promote a culture of trust, confidence and engagement that sets its roots in core values and a code of ethics.

Our goal is to to preserve the reputation of our services through our people’s commitment to the highest standards of corporate governance. It’s a responsibility we collectively share as we shield the bank against potential risks and stir it towards further success stories.

B-How we operate

At Saradar Bank, our Board sets the tone at the top. The Board works closely with senior management to ensure the proper conduct of business and to promote integrity and corporate values. Our commitment to excellence in corporate governance has yielded great results on our business. This effort was recognized in 2016 by the CFI.co when Saradar was awarded “Best Bank Governance Award in Lebanon”

2. Board Governance Framework

We have outlined a straightforward framework that lays out the responsibilities of the Board and management.

The objective here is to support the Board in achieving the long-term strategic goals of the bank and in generating sustainable returns for our shareholders.

3. Corporate Governance Approach

Our Board of Directors (“Board”) takes all the bold decisions that shape the bank’s operations and strategy. The Board is made up of independent directors who bring leadership and many years of experience in different industries to the table. To carry out its duties and responsibilities in an efficient and effective manner, the Board can have between 3 to 12 members with the current number standing at 12.

In addition to ensuring the proper conduct of business and overseeing the management of the bank, our Directors play a primary role in improving the Bank’s value to the shareholders by defining strategic direction and objectives, providing leadership and guidance, introducing a sound corporate governance framework, promoting corporate values and ensuring that effective internal control processes are in place. In that regards, their commitment positively impacts our successful performance and position in the market.

We understand the importance for preserving independence at Board level. Guided by the best practices in corporate governance, we are continuously working on increasing the number of non-executive Directors.

Furthermore, we keep an open-minded approach on improving our governance principles when and where needed. This guarantees that we stay up to date with leading corporate governance practices.

4. Ownership Breakdown

The Bank’s shareholders are local and international visionaries. They include global leaders such as Carlos Ghosn, established groups like the Wiederkehr Group, and prominent Lebanese families like the Saradars, Bustanis, Mecattafs, Mikatis, El-Khazens and Shammas. Shareholders breakdown:

SARADAR PARTNERS 30.81%
STÉ AL BUSTANIA SAL 19.71%
WIEDERKEHR GROUP HOLDING SAL, 12.62%
SHAMMAS ECONOMIC INSTITUTE SAL 12.04%
SAIFI INVEST HOLDING SAL 11.32%
CARLOS GHOSN 4.58%
BEATRICE WIEDERKEHR 2.36%
MYRNA BUSTANI 2.03% JAMIL
EL-KHAZEN 1.96%
LAURA EL-KHAZEN LAHOUD 1.96%
OTHERS 0.61%

5. Board Committee

The composition of each Committee is approved by the Board in line with applicable rules and procedures and any other relevant considerations. In endorsing suitable membership on Committees, the Board ensures that the Directors appointed are qualified and have the experience and insights needed to make better decisions.

Board Committees	Chairperson	Members
Audit Committee	Mr. Joseph Saddi	Laura El-Khazen Lahoud Saiﬁ Invest Holding SAL represented by Mr. Christian Mecattaf Mr. Joe Issa-El-Khoury Mr. Christian Steinfels
Remuneration Committee	Mr. Joseph Saddi	Shammas Economic Institute represented by Mr. Nizam Shammas Saiﬁ Invest Holding SAL represented by Mr. Nabil Moukattaf Mr. Joe Issa-El-Khoury
Rsik Committee	Sheikh Michel El Khoury	Saiﬁ Invest Holding SAL represented by Mr. Christian Mecattaf Sheikh Jamil El-Khazen
AML/CFT Committee	Mr. Michel Fernein	Laura El-Khazen Lahoud Mr. Joe Issa-El-Khoury

Board Audit Committee

The Board Audit Committee assists the Board in fulfilling its duties and supervisory roles regarding internal controls and audit. The committee’s responsibilities encompass:

Control of financial statement soundness.

Efficiency and effectiveness of internal regulations and procedures.

Follow-up on audit recommendations.

Monitoring the Bank’s compliance with the applicable laws and regulations.

Board Remuneration Committee

he Board Remuneration Committee is responsible for:

Advising the Board on setting and reviewing the bank’s policy on remuneration, bonuses and incentives.

Ensuring that remuneration packages are competitive and support the recruitment and retention of senior executives.

Overseeing the establishment, maintenance and administration of the Bank’s remuneration programs and employee benefit plans.

Ensuring that the Bank’s compensation practices are in line with the bank’s vision, values and overall corporate objectives.

Board Risk Committee

The Board Remuneration Committee is responsible for:

Assisting the Board in fulfilling its oversight responsibilities with regards to risks inherent to the Bank’s strategy and activities.

Monitoring the overall risk framework.

Reviewing and monitoring risk policies in line with the bank’s strategy and business plan.

Reviewing and monitoring the risk appetite and tolerance statement.

Ensuring that risks are identified, measured, monitored and mitigated in line with the bank’s risk appetite and the risk strategy.

Board AML/CFT Committee

The AML/CFT Committee assists the Board in exercising its supervisory role, and in taking the appropriate actions to combat money laundering and terrorist financing.

The Committee will meet at least two times a year. The Committee’s roles and responsibilities are defined within its Charter.

The AML/CFT Committee responsibilities include:

Reviewing reports submitted by the Compliance Department and the Internal Audit Department regarding adopted procedures, unusual operations and high risk accounts, in accordance with the risk-based approach, and taking appropriate decisions as required.

Reviewing the reports submitted by the regulators and external auditors on the Bank’s compliance with the AML/CFT regulations and ensuring that remedial measures are properly implemented.

Identifying, assessing and mitigating AML/CFT risks. The committee will report to the Board significant developments, issues and concerns in the Bank’s AML/CFT compliance framework.

Reviewing and appraising the effective performance of the AML/CFT functions of the Bank’s Compliance department.

The Chairman of the Committee will contribute to the appointment and dismissal of the Head of Compliance, whose official nomination will be endorsed by the Board.

The Chairman of the Committee also takes part in the evaluation of the Head of Compliance performance and in defining his corresponding remuneration.

6. High Level Structure

Legal Advisors

El Khoury & Partners Law Firm
Roger Najjar Law Firm
Hachem Law Firm

Auditors

Deloitte
Ernst & Young

7. Remuneration Policy

We reward talent and we care about integrity, productivity and job satisfaction. Our remuneration policy provides the incentive for our employees and management to always perform in the best interests of the bank. The remuneration policy…

is transparent and aligned with our corporate culture, long term objectives, risk strategy, performance, and legislative and regulatory frameworks.

Supports the bank’s goals for sound corporate governance.

Allows the bank to sustain value creation in the short and long run while staying responsible towards our people, shareholders and the other stakeholders.

Ensures that remuneration packages are competitive and in line with the market.

In setting the compensation packages we make sure…

They are commensurate with the relevant duties and responsibilities of each individual.

They are fair and equitable.

They integrate incentives clearly and measurably to performance both on individual and corporate basis.

That remuneration is sustainable in the long-term.

In the first quarter of every year, the Remuneration Committee examines the bank’s remuneration strategy and plans in light of the bank’s performance, local industry practices and market conditions.

The Board reviews, assesses and endorses the remuneration and incentive schemes for the coming year based on the recommendations of the Remuneration Committee. The total bonus amount to be distributed is reviewed by the Remuneration Committee and approved by the Board. The cumulative consolidated remuneration disbursed by the bank is incorporated in the budget and endorsed by the Board.

Our main strength is our people. We believe that their professional development is central to our success in attaining the vision we set for the bank. Therefore, we have introduced a general assessment exercise to analyze their performance and to highlight the positive sides and the areas requiring improvement.

We believe in meritocracy and we encourage everyone to perform at their best in any position they hold. The annual performance evaluation ensures transparency and plays a major role in the career progress of our people and in determining their remuneration.

The performance of our people is measured against Key Performance Indicators (KPIs) in line with the Bank’s overall remuneration and incentive strategy.