4 Role of the chair of the management body

The chair of the management body should lead the management body, contribute to an efficient flow of information within the management body and between the management body and the committees thereof, where established, and should be responsible for its effective overall functioning.

The chair should encourage and promote open and critical discussion and ensure that dissenting views can be expressed and discussed within the decision-making process.

In accordance with Article 88(1)(e) of Directive 2013/36/EU, the chair of the management body in its supervisory function of an institution cannot exercise simultaneously the function of a CEO within the same institution. As a general principle, the chair of the management body should be a non-executive member. Where the chair is permitted to assume executive functions, including in another entity within the group, the institution should have measures in place to identify, assess and mitigate, where relevant, any adverse impact on the institution ’s checks and balances , including by appropriately managing conflicts of interest, for example by designating a senior or lead independent board member, or through other appropriate governance arrangements, such as ensuring a sufficiently strong presence of non-executive members within the management body.²¹

²¹ This is a non-exhaustive list of examples provided by BCBS principles on corporate governance published in 2015 and institutions can implement other appropriate safeguard measures.

The chair should set meeting agendas and ensure that strategic issues are discussed as a matter of priority. They should ensure that decisions of the management body are taken on a sound and well-informed basis and that documents and information are received in a timely manner before the meeting.

The chair of the management body should contribute to a clear allocation of duties between members of the management body and the existence of an efficient flow of information between them, in order to allow the members of the management body in its supervisory function to constructively contribute to discussions and to cast their votes on a sound and well-informed basis.