Sound governance cannot be achieved by organizational structures, procedures and control mechanisms alone, but relies to a large extent on the commitment and dedication of all members of staff of the credit institution.
Therefore it is essential that the management body should determine the strategic objectives and corporate values of the credit institution as well as internal codes of conduct or formal rules that specify the conduct of business in a spirit of integrity that also takes into account the institution's stakeholders. These objectives, values and codes should be communicated and promoted throughout the institution and should also be integrated into the training programme for staff and the induction of the members of the management body. It is important that in implementing these values, the management should impose upon itself strict and demanding rules of conduct and that it should set the tone at the top.
The internal codes of conduct should relate inter alia to subjects such as corruption, acceptance of unjustified gifts or advantages in cash or in kind, abuse in transactions between staff and the institution (granting of credit, preferential rates, etc.) and all sorts of other unethical or illegal behaviour in the context of internal or external activities.
It is the responsibility of the credit institution to set up an appropriate organization and adequate procedures to ensure that the members of staff of the institution are beyond reproach. Besides the usual checks at the time of recruitment, the institution should continuously take the necessary measures to ensure compliance by their members of staff with the legal and regulatory provisions regarding integrity and conduct. The compliance function has an important role to play in enforcing the policy defined by the credit institution.