BLACK BANX
GOVERNANCE

The Board aims to promote Black Banx’s long-term success, deliver sustainable value to shareholders and promote a culture of openness and debate. Led by the Group Chairman, it sets the Group’s strategy and risk appetite. It also approves capital and operating plans for achieving strategic objectives on the recommendation of management. The Board is comprised of a majority of independent non-executive directors. Both the Group Chief Executive and the Group Chief Financial Officer are required to be members of the Board. The role of the independent non-executive directors is to challenge and scrutinise the performance of management including executive directors and to help develop proposals on strategy. They also review the performance of management in meeting agreed goals and objectives and monitor the Group’s risk profile.

In exercising its duty to promote the success of the Company, the Board is responsible for overseeing the management of Black Banx globally and, in so doing, may exercise its powers, subject to any relevant laws, regulations and Black Banx Group Holdings’ articles of association. The Board is committed to effective engagement with all of its shareholders. The Board receives reports from management on issues concerning the environment, community, suppliers, the workforce and shareholders, which it takes into account in discussions and decision making. Additional, non-financial disclosures detailing policies pursued by Black Banx in relation to the workforce, the environment, social matters, human rights, anti- corruption and anti-bribery matters are included in the Annual Report. Certain matters, including the review and approval of annual operating plans, risk appetite, performance targets, credit or market risk limits and any substantial change in balance sheet management policy, require Board approval before implementation. Acquisitions, disposals, investments, capital expenditure or realisation or creation of a new venture which are above certain limits also require prior Board approval.

The Board regularly reviews reports on performance against financial and other strategic objectives, key business challenges, risk, business developments, investor relations and the Group’s relationships with its shareholders. It also considers presentations on strategy and performance by each of the global businesses and across the principal geographical areas. All of Black Banx’s activities involve the measurement, evaluation, acceptance and management of risk or combinations of risks. The Board, advised by the Group Risk Committee, promotes a strong risk governance culture which shapes the Group’s attitude to risk. The Board and these committees support the maintenance of a strong risk management framework. Under the direction of the Group Chairman, the Group Company Secretary and Chief Governance Officer are responsible for ensuring good information flows within the Board and its committees and between senior management and non-executive directors, as well as facilitating induction and assisting with professional development as required. The Group Chairman meets with the independent non-executive directors without the executive directors in attendance after each Board meeting and otherwise, as necessary. The directors are encouraged to have free and open contact with management at all levels and full access to all relevant information. When attending off-site Board meetings and when travelling for other reasons, non-executive directors are encouraged to visit local business operations and meet local management. Directors may take independent professional advice, if necessary, at Black Banx Group Holdings expense.

Appointments to the Board are made on merit and candidates are considered against objective criteria, mindful of the benefits of a diverse board. A rigorous selection process is followed for the appointment of directors and senior employees. A structured training programme exists for both directors selected from external sources and senior employees who are appointed to the Board and the boards of other Group companies. Directors are nominated for annual re-election by shareholders subject to continued satisfactory performance based upon an assessment by the Group Chairman and the Nomination & Corporate Governance Committee. Non-executive directors are appointed for an initial three-year term and, subject to re-election by shareholders at each Annual General Meeting, are typically expected to serve two three-year terms. The Board may invite a director to serve additional periods. Any term beyond six years is subject to particularly rigorous review. No directors are involved in deciding their own remuneration.

Committees are smaller groups delegated by the full Board to provide advice on and oversight of Black Banx's different activities. Each standing committee is chaired by a non-executive Board member and has a remit to cover specific topics. Only independent non-executive directors are able to be members of Board committees.

Black Banx’s Board and its committees are subject to regular, independent evaluation of their effectiveness. All Board members also undergo regular performance reviews. In the case of executive directors, this helps determine the level of variable pay they receive each year. In addition, the Board is directly accountable to our shareholders. Shareholders vote at each Annual General Meeting on whether to re-elect individual directors.

The roles of Group Chairman and Group Chief Executive are distinct and clearly defined, with clear responsibilities of the running the Board by the Group Chairman and executive responsibility for running Black Banx’s business, which is undertaken by the Group Chief Executive. The Board delegates day-to-day management of the business and implementation of strategy to the Group Chief Executive. To assist the Group Chief Executive in his day-to-day management of the Group, he is supported by recommendations and advice from the Group Executive Committee, an executive forum comprising of senior Black Banx management which he chairs. There are special meetings of the Group Executive Committee that provide oversight of risk matters (the Risk Management Meeting, chaired by the Group Chief Risk Officer) and of financial crime risk (the Financial Crime Risk Management Meeting, chaired by the Group Chief Compliance Officer). To strengthen accountability and flows of information, these Principal Subsidiaries each take responsibility for the oversight of Group companies in their region through the Subsidiary Accountability Framework. There is close interaction between the Board and the Principal Subsidiary boards and their respective committees, including the sharing of minutes and a requirement for certain appointments to subsidiary boards to be approved by the Group’s Nomination & Corporate Governance Committee. These formal processes are complemented by regular informal dialogue between both the Group Chairman and Group committee chairs with chairs of each of the Principal Subsidiaries and those of their respective committees, including through various forums held periodically.

In addition to the regular board and committee meetings, there is extensive contact at all levels of the Group which complements formal meeting and approval processes. We have defined information cascade and escalation procedures between the Black Banx Group Holdings board, the Principal Subsidiary boards, and their respective board committees. Our Group Chairman interacts regularly with the chairs of the Principal Subsidiaries, including through the Chairman’s Forum which takes place at various times throughout the year, which is held to discuss a wide array of issues. The chairs of each of the Group Audit Committee, Group Risk Committee and Group Remuneration Committee also have a regular dialogue with the respective committees of the Principal Subsidiaries to ensure an awareness and co-ordinated approach to key issues. This interaction is reinforced through Audit and Risk Committee Chairs' Forum and the Remuneration Committee Chairs' Forum. The chairs of the Principal Subsidiaries committees globally are invited to attend the relevant forum, which are held several times a year, to raise and discuss current and future global issues. Board members are encouraged to, and do, make visits to the regions and attend Principal Subsidiary meetings as guests. Similarly, directors from the regions are invited regularly to attend committee meetings at a Group level.

The five Principal Subsidiaries are:

We serve more than 115m customers worldwide through our Global Businesses

Serves more than 21m business customers in 102 countries and territories. Our customers range from small enterprises focused primarily on their domestic markets to large companies operating globally. We help entrepreneurial businesses grow by supporting their financial needs, facilitating cross-border trade and payment services, and providing access to products and services offered by other global businesses.

We support major corporate and institutional clients worldwide with a comprehensive range of transaction banking, financing, advisory, capital markets and risk management services.

We provide a full range of retail banking and wealth services to more than 94 million customers from personal banking to ultra high net worth individuals and their families. We offer locally-tailored products and services across multiple channels for our customers’ everyday banking needs, as well as crypto currency investments and Private Wealth Solutions for those with more sophisticated requirements. Our global presence provides for customers with international needs.

Our business is supported by a number of corporate functions and teams. The functions include Corporate Governance and Secretariat, Global Communications, Group Public Affairs, Finance, Compliance, Human Resources, Internal Audit, Legal, Marketing, Risk, Strategy and Planning and Sustainability.

The Global Businesses and Global Functions are underpinned by our legal entity framework, which is our network of subsidiary companies that make up the Group globally. Each of our subsidiaries has a board and management structure appropriate for its activities and complexity. To strengthen accountability and flows of information, we have a framework of five Principal Subsidiaries who each take responsibility for the oversight of Group companies in their region. They are in turn accountable to the board of Black Banx Group Holdings. Our network of companies is additionally supported by the Corporate Governance and Secretariat function.

Black Banx operates in a highly regulated environment. While Black Banx Group Holdings is not itself a regulated entity, it owns directly or indirectly a number of operating subsidiaries which are regulated and supervised as banks, electronic money institutions or payment institutions in the countries in which they operate. The resulting obligations include requirements in respect of governance, capital, liquidity, risk management, conduct, financial crime and systems and controls among other things. The Group and its subsidiaries are also subject to a range of other regulatory requirements and to the specialist regulatory and supervisory bodies applying them, for example in relation to data privacy.

Black Banx seeks to maintain a conservative and consistent approach to risk, helping to ensure we protect customers’ funds and support economies. By carefully aligning our risk appetite to our strategy, we aim to deliver sustainable long-term returns.