EBA Guidelines on Internal Governance

Internal governance for institutions in the European Community is covered by Article 22 of Directive 2006/48/EC, which requires, that every credit institution has robust governance arrangements, which include a clear organisational structure with well defined, transparent and consistent lines of responsibility, effective processes to identify, manage, monitor and report the risks it is or might be exposed to, adequate internal control mechanisms, including sound administrative and accounting procedures, and remuneration policies and practices that are consistent with and promote sound and effective risk management‟.