“Our strong commitment to ensure that we enjoy sound corporate governance help us deliver value to all our stakeholders."
The Board is responsible for providing leadership for the institution. It ensures that the right strategy and controls are in place to deliver value to shareholders, employees and the community.
Corporate governance issues rate high within CIB, both in terms of aligning the interests of shareholders and managers, and the monitoring of management through information disclosure and transparent reporting. CIB adopted a sound and effective system of corporate governance best practice, comprising highly professional executive directors, senior management, competent board committees, and independent non-executive directors of experience and integrity. In addition to an internal audit and control department equipped with the best qualified and well trained staff, an efficient investor relations program and two reputable audit firms with an impeccable record of accounting and auditing practice.
Our corporate governance framework ensures that timely and accurate disclosure occurs with respect to material matters regarding the Bank, its ownership, operations and financial performance. It also advocates the equal treatment of all shareholders with sound protection to their voting rights. CIB has a practice of changing auditors every five years to ensure objectivity and to benefit from new practices.
Another important strength is CIB’s board composition. The Board is comprised of a majority of non-executive directors who play key roles. The varied expertise of the non-executive directors has created an unusually strong combination of directors, all with relevant knowledge and balanced skills and experience.
The Board of Directors
The Bank management structure is based upon centralization of controls from the top management level at the Head Office. The Board of Directors directs the Bank businesses by setting the overall strategy, and approves all operating policies.
CIB BOD currently consists of two executive and six non-executive members with various expertise. When a board seat is vacant, the Compensation and Governance Committee is responsible for nominating a member, subject to the board’s consent, who is then formally appointed after gaining approval at the General Assembly and the Central Bank of Egypt. The Directors meet at least four times per annum. During 2008, the Board of Directors convened six times.
Starting early 2006, a group of experienced business leaders representing Ripplewood Holdings L.L.C., Eton Park Capital Management, RHJ International, and International Finance Corporation have been part of the Board. This group includes Robert Willumstad, the former President and Chief Operating Officer of Citigroup, Lucio Noto, the former Chairman and Chief Executive Officer of Mobil Corporation, and Tim Collins, Chief Executive Officer of Ripplewood Holdings. Paul Volcker, former Chairman of the Federal Reserve Bank, serves as Senior Advisor to the Board.
Accordingly, the Board of Directors, in its new and expanded form, consists of the following individuals:
Mr. Hisham Ezz Al-Arab Chairman and Managing Director MC[1]...C, HLIC...C
Hisham Ezz Al-Arab joined CIB in 1999 as Deputy Managing Director and was elected Chairman and Managing Director in September 2002. He has had a wide experience of more than 30 years in global banking activities that he gained in senior positions at JP Morgan, Merrill Lynch. and more recently Deutsche Bank in the United Kingdom, Middle East, and the United States.
Mr. Essam El Wakil Member and CEO Institutional Banking RC...M, MC...M, HLIC...M
Mr. El Wakil enjoys almost 34 years of experience in various business and supporting areas, exemplified by: Credit, Corporate, Project and Trade Finance, Investment Banking and Strategic Planning. Mr. El Wakil is a board member of the Federation of Egyptian Banks “FEB”.
Mr. Mahmoud Fahmy Member AC...M, GCC...M
Counselor Fahmy is a renowned Egyptian lawyer and international arbitrator. He was the Chairman of Egyptian Capital Markets Authority, the General Authority for Investments, and the Secretary General of the National Counsel.
Mr. William Mikhail Member and Chairman of the Audit Committee AC...C, RC...C
Dr. Mikhail is currently an Econometrics professor at the American University in Cairo (AUC), and a member of CIB Board since 1997. He obtained his Ph.D. from London School of Economics, London University, in 1969. In addition to his academic career, Dr. Mikhail worked with international consulting firms, and as a U.N. consultant on Econometric Modeling and Economic Policy analysis in many countries for more than two decades. He published extensively in econometric theory and applied econometrics in international journals, and supervised many Ph.D. and M.A. theses in both Cairo University and the American University in Cairo.
Dr. Nadia Makram Ebeid Member GCC...C
Dr. Nadia Makram Ebeid is the Executive Director of the Center for Environment and Development for the Arab Region and Europe (CEDARE), an international diplomatic position she assumes since January 2004. For a period of five years starting 1997, Dr. Ebeid was Egypt’s first Minister of Environment becoming the first woman in charge of this position in the Arab World. During her earlier career, Dr. Ebeid was selected for several managerial posts with the United Nations Development Program (UNDP), the United Nations Food and Agriculture Organization's Regional Office for the Near East, Council for Environment and Development Research. In support of her role in environmental policy and advocacy, Dr. Ebeid has received numerous awards of recognition and distinctions from local and international NGOs, leading institutions and associations.
Mr. Robert Willumstad Member AC...C, RC...C
Robert Willumstad is the former Chairman and CEO of AIG, and until recently was President and Chief Operating Officer of Citigroup and a member of its Board of Directors. After 20 years with Chemical Bank, and 11 years with Commercial Credit and its successor companies, in October 1998, Mr. Willumstad played a critical role in creating Citigroup, a history making combination of the former Travelers Group and Citicorp. After serving as the Head of Global Consumer Lending, Mr. Willumstad was the Chairman and CEO of Citigroup’s Global Consumer Group from 2000 to 2003, where he led all consumer businesses, including credit cards, consumer finance and retail banking. In addition, he had oversight of Citigroup’s consumer operations in Western europe, Japan and Mexico.
Mr. Willumstad, President of Citigroup in 2002, joined its Board of Directors in 2003; becoming Citigroup’s Chief Operating Officer in October 2003. He is a Director of MasterCard Incorporated/MasterCard International Incorporated and Habitat for Humanity International. He is a trustee of the American Scandinavian Foundation and Adelphi University.
Mr. Walid Shash RC...M
Walid Shash is currently the Head of the MENA Institutional and Private Wealth Management Business, Union Bancaire Privee (UBP) Geneva. Since his graduation in 1982 with a BA in Economics and Business Administration from the American University in Cairo, Mr. Shash has served in a number of renowned financial institutions; namely, Misr American International Bank, Union des Banques Arabes et Francias (UBAF), Paris, Lehman Brothers and Prudential Securities in Geneva.
Mr. Frank G. Wisner - Member
Ambassador Frank G. Wisner is the international affairs advisor to Patton Boggs LLP, a full-service firm with a national presence in every major area of legal representation. Prior to joining Patton Boggs, Mr. Wisner served as Vice Chairman of the American International Group (AIG), external affairs, following his retirement from the U.S. government with the personal rank of Career Ambassador, the highest grade in the Foreign Service.
Mr. Wisner joined the State Department in 1961 and served in a variety of overseas and Washington positions during his 36-year career. Among his other posts, Ambassador Wisner served successively as U.S. Ambassador to Zambia, Egypt, the Philippines and India.
Currently, he is on the board of the U.S. India Business Council. Mr. Wisner is a member of the boards of Directors of EOG Resources, an oil and natural gas exploration and production company and Ethan Allen, a large furniture manufacturer. He has been a member of the Board of Directors of the Pharaonic American Life Insurance Company (ALICO) in Egypt since 2007. He is a senior advisor at Kissinger Associates. Mr. Wisner is Vice Chairman of the Business Council on International Understanding. His non-profit board affiliations include, but are not limited to: Rockefeller Brothers Fund, the American University in Cairo, Princeton University's Middle Eastern Affairs Advisory Board and the advisory board at Columbia University's SIPA. Mr. Wisner graduated from Princeton University with a B.A. degree in 1961.
Dr. Medhat Hassanein - Member
Dr. Medhat Hassanein, Egypt's former Minister of Finance (1999-2004), is currently a professor of Finance and Banking with the Management Department of the School of Business, Economics & Communication at the American University in Cairo.
Dr. Hassanein is a senior policy analyst with long experience in institutional building, macro-policy analysis, financial economic, corporate finance and international financial management. He has previously served as advisor to government, high-level advisory bodies and the donor community. During his term as Minister of Finance, he developed and instituted the second generation set of fiscal public policy reforms for the government of Egypt. Dr. Hassanein has also served as Chairman and Board Member in public holding companies, private corporations and many renowned banks in Egypt, last of which was HSBC Egypt (2004-May 2009) where he chaired its Audit Committee.
Dr. Hassanein obtained a B.A. in Economics from Cairo University (graduating with honors), an M.B.A. from New York University (graduating with distinction) and a Ph.D. from Wharton School, University of Pennsylvania.
The Board of Directors’ Committees
Following the expansion of the Board of Directors during the first quarter of 2006, the Board will oversee the Bank through the Board Committees and the reports generated to evaluate the Bank periodic performance regarding all aspects of operations. As such, the Board will meet around six times a year, physically, or through Video or Tele-Conferencing, in Egypt, with one meeting held in New York City.
In addition to the Board’s Audit Committee, Risk and Governance and Compensation committees, CIB has recently established High Lending & Investment Committee as well as Management Committee. The structure of each committee ensures the highest standards of corporate governance, empowers it, and links it to the strategic direction of the Bank.
Audit Committee
CIB was one of the first banks in Egypt to set up an audit committee of the Board in compliance with the basic principles of corporate governance. In September 1998, the Bank Board decided to form the committee in order to ascertain the soundness of the Bank's internal audit system and compliance with the rules specified by regulatory authorities.
The Committee’s mandate was extended and articulated in greater detail in the years that followed, especially in light of the Central Bank of Egypt’s issuance of a number of rules to be observed and guidelines to be followed in June 2002. Accordingly, the role of the committee was redefined in September of the same year to emphasize its independent nature. Its scope was also modified to be more specific, especially in relation to risk management, Basel II compliance, money laundering, as well as internal and external audit practices.
Three independent board members form the audit committee. They meet exclusively and regularly with the Bank’s external auditors. Bank executives are regularly invited to attend certain meetings when relevant issues are broached.
The Governance and Compensation Committee
The Committee is responsible for the development and reviewing of a set of Corporate Governance guidelines, which are then recommended to the Board.
The Committee reviews the remuneration of the Board of Directors (both executive and nonexecutive members). This also incorporates any stock option proposals to the Bank’s Executive and Senior Management staff. It is also to act as a nomination committee when a board seat is vacated.
The Risk Committee
On the macro level, this committee sets the Bank's “Credit Risk Strategy” and the portfolio mix (concentration and limits) for corporate, retail, banks, countries, etc. to be approved by the Board. Exposures according to risk rating, amount and tenor are approved by other committees led by the High Policies Committee.
Management Committee
Mr. Hisham Ezz Al-Arab Chairman, Mr. Essam El Wakil Member CEO of Institutional Banking, Mr. Humayun Rashid CEO of Consumer Banking, and Mr. Jawaid Mirza COO are the representatives of the Management Committee. They meet exclusively without the attendance of the Bank’s executive officers, unless the need arises to invite one or more of them. The management committee will be responsible for setting the overall strategy as well as the financial and operational performance of the Bank.
The High Lending and Investment Committee
The committee’s prime mandate is to focus on the credit and investment decisions of the Bank. It is composed of the Bank’s top executives who regularly review and decide on the credit facilities, equity investments, focusing on the asset quality, allocation and its development. They are responsible for taking decisions of an executive or administrative nature; therefore allowing the BOD to focus on strategies and growth opportunities and in turn, decrease inherent conflicts of interest.
References:
Audit Committee.....AC
The Governance and Compensation
Committee.....GCC
Risk Committee.....RC
Management Committee.....MC
High Lending and Investment Committee.....HLIC
Chairman.....C
Member.....M