ABK Group

Corporate Governance

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Corporate Governance

ABK Group is committed to upholding high standards of governance, establishing solid and effective corporate values, and fostering a culture of governance throughout the entire group. Governance standards are a crucial aspect reflected in the Group's strategy. ABK has built a strong reputation by adhering to ethical principles and taking the necessary steps to enhance its commitments. We believe that adhering to sound governance principles is the best way to protect ABK’s interests and reputation thus safeguarding the rights of shareholders and all stakeholders, and enhancing their confidence in the Group's performance and the Kuwaiti banking sector as a whole.

With our firm belief that governance is the best foundation for principled and sustainable long-term growth, the Group always strives to ensure the adoption and implementation of sound governance practices. To achieve this goal, ABK has established an organizational structure that promotes accountability and transparency. ABK is fully aware of its role in Kuwaiti society, not only as a provider of business services, but also as a supportive and encouraging element in the overall development of the community. Initiating and supporting healthcare and educational projects, providing financial support for events and sports activities, and nurturing cultural initiatives are all integral parts of ABK’s commitment to its national and social responsibilities.

Furthermore, ABK engages shareholders and stakeholders, enabling them to monitor performance by enhancing transparent and timely disclosures of its activities on its website and annual report, in line with the regulations and instructions issued by the Central Bank of Kuwait, the Capital Markets Authority, and Boursa Kuwait rules.

Chairman of the Board of Directors

The Chairman of the Board of Directors plays a pivotal role in ensuring the smooth functioning of the Board, maintaining mutual trust among members, establishing a constructive relationship between the Board and the Executive Management, and ensuring the presence of high governance standards within the Bank. The Chairman of the Board of Directors is primarily responsible for leading the Board to ensure its effective operation, fulfilling its duties, and carrying out its legal and oversight responsibilities. The Bank's policy clearly separates the positions of the Chairman of the Board of Directors from that of the Chief Executive Officer.

Board of Directors

According to relevant laws, ABK’s Articles of Association, and governance rules, members of the Board of Directors are elected by the shareholders in the annual general assembly meeting through a secret ballot for a term of three years, subject to the approval of the Central Bank of Kuwait. The Board of Directors consist of 11 non-executive members, with 7 non-independent members elected and 4 independent members chosen. The Board of Directors’ overall structure is characterized by diversity in academic qualifications, practical experience, specialized skills, and relevant knowledge in the fields of banking, finance, strategic planning, governance, risk management, internal control, regulatory compliance, and oversight.

The Board of Directors assumes responsibility for the Bank, including setting strategic goals, approving action plans and budgets, defining risk strategies and appetite, developing governance standards, endorsing policies, enhancing public trust in management, actively participating in regulating operations, and bearing all responsibilities related to its financial soundness. This also includes safeguarding the interests of shareholders and stakeholders, focusing on risk management and governance, encompassing information security risks, cybersecurity, compliance governance, enhancing internal control systems and internal and external auditing, as well as supervising Executive Management. Other duties and responsibilities mandated by laws, regulations, and regulatory instructions also fall under the purview of the Board.

The Board of Directors place great importance on governance practices, aiming to instil a culture of institutional values among all employees. This is achieved by continuously striving to attain strategic objectives, improving performance rates, and adhering to laws and regulatory instructions, particularly governance rules and systems that are effectively applied as an institutional culture rather than mere regulatory instructions.

Talal Mohamed Reza Behbehani

Chairman

Salah Ahmed Al Serhan

Deputy Chairman

Ali Ibrahim Hejji Hussain Marafi

Board Member and
Chairman of ABK-Egypt

Khaled Othman Abdulwahab
Al Othman

Board Member

Adel Ibrahim Yali Ahmed Behbehani

Board Member

Raed Abdulkareem Al Moamen

Board Member

Zaid Khaldoun Hassan Al Naqeeb

Independent Board Member

Dr. Mahdi Ismael Ali Al Jazzaf

Independent Board Member

Tarek Fareed Abdulrahman Al Othman

Independent Board Member

Bassem Sulaiman Mohammad
Al Otaibi

Independent Board Member

Fawzy T. Al Thunayan

General Manager, Board Affairs

Board Committees

Within the process of enhancing the Group’s principles of Corporate Governance, the Board of Directors formed a number of board committees to enhance the Board’s oversight on key operations at the Group level. This takes into account the Group's size, nature of activities, and geographical distribution of its entities. Each committee has an approved charter from the Board of Directors outlining its roles and responsibilities and governing its functions, and matters pertaining to the preparation of regular reports based on the nature of its duties and responsibilities, which are then presented to the Board of Directors.

All committees are composed of members of the Bank's Board of Directors who possess the required expertise for each committee, in accordance with its scope of work as outlined by governance rules. It should be noted that the existence of committees stemming from the Board of Directors does not exempt the Board from assuming direct responsibility for all matters related to the Group.

The committees are as follows:

BCGCC

Board Corporate Governance and Compliance Committee

BRAC

Board Risk and AML&CFT Committee

BAC

Board Audit Committee

BNC

Board Nomination Committee

BCHRC

Board Compensation and HR Committee

BC&IC

Board Credit & Investment Committee

BMC

Board Monitoring Committee for UAE Branches and DIFC Branch

BTC

Board Transformation Committee

For more information regarding the formation, tasks, responsibilities, activities, and meetings of these committees, please refer to the Corporate Governance Manual and the Governance report in ABK’s annual report.

Executive Management

The Board of Directors, following the approval of the Central Bank of Kuwait, appoint a Chief Executive Officer (CEO) for the Group, as well as deputies and assistants from among the members of the Executive Management who possess the necessary banking competence and experience. Additionally, the Board of Directors provide sufficient oversight over the Executive Management to ensure their fulfillment of the roles entrusted to them in achieving ABK’s objectives, and to verify the implementation of the strategies, plans, and policies approved by the Board of Directors.

Abdulla M. Al Sumait

Acting Group Chief Executive Officer

Ahmad Al-Duwaisan

Acting Chief Executive Officer - Kuwait and
General Manager, Corporate Banking

Khaled El Salawy

Chief Executive Officer and Managing Director, ABK-Egypt

Omar Wahby

Chief Executive Officer - UAE

Rami El Rifai

General Manager and Senior Executive Officer - Dubai International Financial Centre (DIFC)

Shiamak Soonawalla

Group Chief Finance Officer

Amjad Siddique

Group Chief Internal Auditor

Abdulaziz Jawad

Chief Strategy Officer

Mohammad AlQattan

Chief Consumer Officer

Yasmine Salamah

General Manager, Multinational Corporates and Structured Finance

Noura Abdulmohsen Alduweesh

General Manager, Treasury and Investment

Johair Marafi

General Manager, Retail Banking

Salem Al Sarraf

Chief Information Officer

Mohammad Al Bloushi

General Manager, Operations

Counselor Dr. Nawaf AlShuraiaan

General Counsel, Legal

Khalil Al Qattan

Chief Digital Transformation and Innovation Officer

Ammar Al Jazzaf

General Manager, Anti-Money Laundering & Combating the Financing of Terrorism (AML & CFT)

Afrah Alarbash

General Manager, Human Resources

Sana Al Saqabi

Group Chief Compliance & Corporate Governance Department

Group Governance Framework

Establishing ABK’s governance framework reflects a commitment to implementing instructions issued by the Central Bank of Kuwait regarding governance rules and systems in Kuwaiti banks, as well as the international standards set by the Basel Committee on Banking Supervision in this regard. This is aimed at promoting best practices in sound governance, establishing sound and effective corporate values across the Group, and fulfilling legal and regulatory obligations in the countries the Group operates in. This is done to protect ABK, its interests, the rights of its shareholders, and all stakeholders.

The Group continues to enhance its policies, procedures, and practices, with a focus on effectively implementing governance instructions and standards and achieving the principles of sound management. The Group, represented by the Board of Directors, Executive Management, and all employees, bears the responsibility of ensuring the application of the governance framework and adhering to professional and ethical standards in all transactions. The Board of Directors is responsible for setting general strategies and policies, while the Executive Management ensures the implementation of governance through a comprehensive system of policies and procedures. Employees are committed to following and applying governance requirements in their daily activities, in addition to ensuring transparent and accurate disclosure of information in a timely manner, following the instructions issued by the Capital Markets Authority and Boursa Kuwait rules. The governance framework is subject to regular review by the Board Corporate Governance Committee and the Board of Directors.

Group Governance Structure test

ABK has established a clear governance structure aimed at providing sufficient governance standards for the Group. It includes appropriate forms of effective oversight over the Group's activities to achieve sound governance. This structure is periodically reviewed to ensure its ongoing suitability.

The following chart illustrates the general structure of the Group’s governance framework:

Corporate Governance Manual

The Corporate Governance Manual has been prepared for guidance by all relevant parties, including the Board of Directors, Executive Management, and employees, concerning the adherence to principles of sound governance. This manual is developed in accordance with the instructions of the Central Bank of Kuwait regarding governance rules and systems in Kuwaiti banks. It encompasses the nine pillars of governance and the rules and regulations specified therein as a minimum requirement:

Board of Directors
Executive Management
Behavioural Values, Conflicts of Interest, and Group Structure
Risk Management and Internal Controls
Rewards System and Policies
Disclosure and Transparency
Banks with Complex Structures
Protection of Shareholders' Rights
Protection of Stakeholders' Rights

ABK implements the Corporate Governance Manual along with a package of charters, policies, and procedures, in addition to practices that reflect the extent of the Group’s commitment to applying governance instructions and standards. These efforts aim for their effective implementation, the establishment of sound management foundations within the Group, and the enhancement of its culture in this field.

The Corporate Governance Manual is periodically reviewed and updated by the Board Governance Committee, which monitors its execution and verifies the level of compliance. In the event that amendments or updates to the manual are recommended, the matter will be presented to the Board of Directors for review and approval.

Corporate Governance Manual

Code of Professional Conduct

The Code of Professional Conduct, approved by the Board of Directors, stands as a fundamental pillar of governance within ABK. The Board of Directors, Executive Management, and employees are committed to adhering to this code in day-to-day operations and interactions with customers and all other stakeholders. This code is regularly reviewed to ensure its alignment with all developments in the fields of governance, professional conduct, and ethical behavior. The Board of Directors supervises the effective application of the code through audit and internal control activities, aiming to identify any gaps that may arise and take necessary actions to address them.

Conflict of Interest

ABK implements a policy of managing conflicts of interests approved by the Board of Directors. The Bank, under the supervision of the Board Corporate Governance Committee and the Board of Directors, regularly reviews this policy to ensure its alignment with activities, as well as legislative and regulatory developments. Additionally, ABK adopts a set of procedures and protocols for disclosing cases of conflict of interests and the mechanisms for dealing with them.

Dealing with Related Parties

ABK ensures that all transactions with related parties are conducted on equal terms and are subject to the conditions and terms applicable to similar transactions with unrelated parties. This is achieved through the implementation of the related parties dealing policy approved by the Board of Directors. Similarly, ABK, under the supervision of the Board Corporate Governance Committee and the Board of Directors, regularly reviews this policy to align with the nature of the Bank's operations and legislative and regulatory developments. Additionally, a list of related parties to the Bank is maintained, and a set of procedures and protocols for dealing with related party transactions are established.

The nature and volume of ABK’s transactions with related parties are disclosed within the Bank's published financial statements. Regular reports on this matter are also submitted to the Central Bank of Kuwait.

Banking Confidentiality

The Board of Directors, Executive Management, and employees are committed to maintaining the confidentiality of information and data related to ABK, its clients, and other stakeholders, in accordance with the provisions of laws, regulations, and instructions issued by the Central Bank of Kuwait and other regulatory authorities. ABK also ensures the ongoing application of controls to preserve the confidentiality of information, in accordance with the policies approved by the Board of Directors in this regard, as well as internal control systems that mandate the maintenance of banking confidentiality.

Insider Persons

With the aim of preserving the confidentiality of internal information pertaining to ABK and its clients, and minimizing the potential for misuse of such information, procedures have been adopted to regulate dealings in securities for insiders persons. These measures include obtaining required declarations and commitments from insider persons, as well as establishing appropriate contractual arrangements with other insider entities. Furthermore, an up-to-date list of insider persons is compiled and maintained, and necessary forms and records are prepared in this regard.

Whistleblowing

Through the application of the whistleblowing policy approved by the Board, ABK seeks to foster a culture of openness among its employees and others. This policy provides a means by which they can participate in protecting ABK and its interests. It also establishes a mechanism for them to report information they possess to the Bank regarding any transactions or actions within the Bank that may contravene the Bank's policies. Direct communication with the Chairman of the Board of Directors is also enabled, ensuring the necessary protection for whistleblowers.

Disclosure and Transparency

ABK places significant importance on disclosure and transparency, recognizing them as vital means for shareholders to exercise their rights. Accordingly, the Bank has ensured the provision of an approved policy regarding disclosure and transparency. This applies to any information held by the Board of Directors and the Executive Management that must be disclosed to local regulatory authorities, other entities, and the public. The primary objective of this policy is to establish a framework for the disclosure process within ABK, ensuring compliance with laws, regulations, and instructions issued by the Central Bank of Kuwait, the Capital Markets Authority, and the Boursa Kuwait rules related to disclosure and transparency.

Memorandum & Articles Of Association

Memorandum & Articles of Association