3.4 Organisational requirements for the suitability assessment
3:98 As stated above, the primary responsibility for suitability assessment lies with the institution. To carry out this assessment, it must have policies, procedures and processes in place.
3.4.1. Suitability policy
3:99 The institution should develop and implement a suitability policy that takes into account applicable regulations and is aligned with its overall governance framework, corporate culture and risk appetite. In this context, the institution’s statutory governing body should adopt and update a policy for suitability assessment that covers (executive and non-executive) directors, senior managers and persons responsible for independent control functions.
3:100 Where appropriate, the nomination committee should actively contribute to the establishment of this policy and may be supported in this respect by the HR, Legal and Compliance departments.
3:101 The policy should include at least the following:
- the process for the selection, appointment, reappointment and succession planning of members of the statutory governing body, senior managers and persons responsible for independent control functions, and the applicable internal procedure for the assessment of the suitability of these persons;
- the criteria to be used in the suitability assessment, which should include at least the 5 suitability criteria set out in this Manual;
- how the diversity policy and, in particular, the quantitative/qualitative target for the representation of the under-represented gender in the statutory governing body are taken into account as part of the selection process;
- the communication channel with the competent authorities; and
- how the assessment is documented.
3:102 For more information on this subject, please refer to the Governance Manual for the banking sector and Guidelines EBA/GL/2021/06.
3.4.2. Diversity policy
3:103 All institutions covered by this chapter that have the legal status of credit institution or stockbroking firm are required, and those that have another legal status are recommended, to establish a policy to promote diversity within the statutory governing body, so that it is composed of a diverse group of members and that a variety of views are represented on it.
3:104 This policy should cover at least the following aspects of diversity: age, gender, educational background, professional background and, for institutions that are active internationally, geographical provenance. This policy may be part of the suitability policy or separate from it, provided that it is explicitly mentioned in the suitability policy.
3:105 Article 31 of the Banking Law provides, for the institutions covered by this chapter that have the legal status of credit institution or stockbroking firm, that their diversity policy should include a quantitative target for the representation of the under-represented gender in the statutory governing body (this target may be qualitative for small institutions). These institutions should thus quantify the targeted participation of the under-represented gender and specify an appropriate timeframe within which the target should be met and how it will be met. The target should be set for the statutory governing body as a whole, but in the case of a sufficiently large management committee, it may be split between the management function and the supervisory function.
3:106 For more information on this subject, please refer to the Governance Manual for the banking sector and Guidelines EBA/GL/2021/06.
3.4.3. Selection process and succession plans
3:107 Without prejudice to the shareholders’ rights to appoint members of the statutory governing body, the institution’s nomination committee should actively contribute to the selection of applicants for vacant positions as member of the statutory governing body, senior manager (with the exception of senior managers at “N-1” level) and person responsible for an independent control function, in cooperation with the HR, Legal and Compliance departments. More specifically, the nomination committee should:
- prepare a description of the roles of and capabilities for a particular appointment (job profile);
- evaluate the adequate balance of knowledge, skills and experience of the statutory governing body;
- assess the time commitment expected; and
- consider the objectives of the diversity policy.
3:108 The recruitment decision should, where possible, take into account a preselection of suitable applicants which takes into account the diversity objectives set out in the institution’s diversity policy.
3:109 Without prejudice to the shareholders’ rights to appoint and replace all members of the statutory governing body simultaneously, the nomination committee should establish succession plans for members of the statutory governing body, senior managers (with the exception of senior managers at “N-1” level) and persons responsible for independent control functions. These succession plans should ensure the continuity of decision-making and prevent, where possible, too many managers having to be replaced simultaneously. They should also include processes for dealing with sudden or unexpected absences or departures of managers, including any relevant interim arrangements.
3:110 For more information on this subject, please refer to the Governance Manual for the banking sector and Guidelines EBA/GL/2021/06.
3.4.4. Induction and training policy and procedure
3:111 Institutions should establish and implement a policy for the induction and training of members of the statutory governing body. This policy may be part of the suitability policy.
3:112 The human and financial resources provided for induction and training should be sufficient to achieve the objectives of induction and training and to ensure members’ ongoing suitability. Directors should receive key information no later than one month after taking up their position, and their induction should be completed within six months.
3:113 The induction and training policy and procedures should at least set out:
- the induction and training objectives for the persons concerned;
- the responsibilities for the development of a detailed training programme;
- the financial and human resources made available by the institution for induction and training, taking into account the number of induction and training sessions, their cost and any related administrative tasks, in order to ensure that induction and training can be provided in line with the policy;
- a clear process under which any person concerned can request induction or training.
3:114 Institutions should have in place a process to identify the areas in which training is required, both for the statutory governing body collectively and for its individual members.
3:115 For further information, please refer to the Governance Manual for the banking sector.
 See Article 31 of the Banking Law.
 In the specific case of approved or designated (mixed) financial holding companies governed by Belgian law, the implementation of a diversity policy should be considered as a recommendation, as Article 31 of the Banking Law does not apply to (mixed) financial holding companies on an individual basis, but only indirectly on a consolidated or sub-consolidated basis (in accordance with Article 168 of the Banking Law).