Sound and effective corporate governance enables Metrobank to build a culture of accountability and integrity, and sustain our business amidst the rapidly evolving business environment.
Governance Structure
Integrity, accountability, fairness and transparency are the four pillars upon which our governance policies rest. Our corporate governance framework, as embodied in the Corporate Governance Manual (CGM) of the Bank, defines the roles and responsibilities, as well as the practices and procedures, to ensure that the organization is governed with the highest standards of good governance. These principles and values continue to be observed in all its operations and dealings, even during these challenging and unprecedented times.
A full discussion on our corporate governance can be found on our website.
Board Matters
An active and competent Board of Directors is responsible for the governance of the Bank. It has collective responsibilities for leadership and control of the Bank’s affairs, sets the corporate governance tone, leads the process of developing and reviewing the Bank’s strategies annually, oversees the development, review, and approval of the Bank’s vision and mission statements, a sound corporate governance framework, strategic and business plans, risk management, internal control system, financial performance and the adoption of sustainability principles, including environmental and social risk areas.
Board Composition
The Board is composed of a diverse group of proficient people who combine insight and good judgment in implementing good governance. To ensure diversity in the Board, the Bank keeps a balanced representation in terms of gender, expertise, policy-making experience, ethnicity, and independence. Board members possess integrity, probity, physical and mental fitness, competence, education, financial literacy, training, diligence, knowledge and experience relevant to the banking industry.
The Bank consistently maintained a Board composition of 12 directors. Ten are non-executive directors (NEDs), of which five are independent, including one female independent director (ID). This is a deliberate stance to promote objectivity and a strong element of independence in the Board. Independent directors constitute 42% of the Board, bringing focus, clear perspective, and the ability to lead objective board discussions and better decision-making.
Board members are elected annually. In accordance with the Bank’s By-Laws, any stockholder may submit nominations for directorial positions to represent their interest in promoting long-term value creation.
The profiles and composition of our Board are available in our 2021 Annual Report.
Board-level Committees
The Board delegates the Bank’s specific concerns to various committees that prepare and report on issues that require Board decision and approval. There are 10 board-level committees assisting the Board in carrying out its responsibilities.
The Anti-Money Laundering Committee helps the Board in fulfilling its oversight responsibility over the Bank’s Anti-Money Laundering Compliance Management to make sure that the Bank complies with the provisions of the Anti-Money Laundering Act (AMLA), as amended, its Revised Implementing Rules and Regulations, and other related regulations.
The Audit Committee assists the Board in fulfilling its statutory and fiduciary responsibilities, enhancing shareholder value, and protecting shareholders’ interest through effective oversight of internal and external audit functions, transparency and proper reporting, compliance with laws, rules and regulations, the code of conduct, and adequate and effective internal controls.
The Corporate Governance and Compensation Committee (CGCCOM) supports the Board in fulfilling its corporate governance responsibilities and in providing oversight on the implementation of the Bank’s Compliance System.
The Executive Committee is primarily tasked to review and approve credit proposals and policies within its authority and limitations, and provide recommendations or conditions on lending. The Committee may also act on other matters as delegated by the stockholders and the Board within its competence and in accordance with the By-Laws of the Bank.
The Information Technology Steering Committee provides governance and oversight in managing the Bank’s information technology (IT) resources. Its main role is to ensure that IT strategies are consistent with the overall business objectives.
The Nominations Committee reviews and evaluates the qualifications of all persons nominated to the Board. It also reviews the qualifications of those nominated to other positions that require Board approval.
The Overseas Banking Committee assists the Board in its oversight functions over the operations and financial performance of the overseas branches and subsidiaries. It also oversees Metrobank expatriates assigned in countries without a foreign office but with remittance tie-up arrangements.
The Related Party Transactions Committee helps the Board in ensuring that transactions with related parties are reviewed to assess risks and that appropriate restrictions are in place. This is to assure that related party transactions are conducted within arm’s-length and that the Bank’s resources are not misappropriated.
The Risk Oversight Committee, as an extension of the Board, is primarily responsible for the development and oversight of the risk management framework of the Bank, its affiliates, subsidiaries, and its Trust Banking arm.
The Trust Committee is responsible for the oversight of all Trust activities. Its mandate is within the authority provided by the pertinent rules and regulations in the exercise of fiduciary powers under the BSP Manual of Regulations for Banks and BSP Circular No. 766 - Guidelines in Strengthening Corporate Governance and Risk Management Practices on Trust, Other Fiduciary Business, and Investment Management Activities.
The Chairman of the Board and the President
The Chairman of the Board and the President, though independent of each other, work together for the good of the Bank. This separation balances power, responsibility, and accountability, and preserves the independence and decision-making of the Board. Each has clearly defined responsibilities in the Bank’s By-Laws and CGM.
The Chairman of the Board provides leadership, makes sure the Board functions well, and initiates and maintains a relationship of trust among its members.
The President exercises direct and active management of the business and operations of the Bank based on the orders, resolutions, and instructions of the Board, and according to his own discretion whenever the same is not expressly limited by such orders, resolutions, and instructions. He communicates and implements the Bank’s vision, mission, values, and long-term strategy and carries out any organizational change related to these matters.
Board Meetings
Directors have a continuing duty to carry out their responsibilities no matter what the situation is. The pandemic forced corporate boards to change how they work. As the risk to COVID-19 exposure still exists, face-to-face meetings have not yet resumed. As such, the Bank continues to hold Board and the committee meetings virtually with the use of a videoconferencing tool.
Board meetings are held to keep directors up-to-date on the Bank’s performance, as well as to approve strategies, appointments, and other decisions requiring their attention. Regular Board meetings are held every second Wednesday of each month. Special meetings may be called at any time by the Chairman, or, in his absence, by the Vice Chairman, or pursuant to the written request of any of the four directors.
The Annual Stockholders’ Meeting was held virtually on 28 April 2021 without requiring the physical presence of the Board members and shareholders. All Board members were present in the meeting.
Performance Evaluation and Self-assessment
Performance assessment of the Board, Chairman of the Board, President, Board Committees and each of the individual directors using Board-approved rating sheets through the Corporate Governance and Compensation Committee is conducted annually.
Metrobank has adopted an internal self-rating system and procedures to determine and measure compliance vis-à-vis good corporate governance principles and practices as prescribed in the Code of Corporate Governance.
This evaluation process allows the Board to consider the accomplishments of individuals and the group of individuals within the Board. This serves as an avenue to revisit existing processes or areas in need of improvement within the Board.
In line with the SEC rules and best practices for Publicly-Listed Companies, the annual performance evaluation covering Year 2020 was assessed by an external facilitator, Reyes Tacandong & Co. (R&T), in February to May 2021. The principal objective of the review was to provide an independent assessment of the effectiveness of the Board, Board Committees and Chairman of the Board, and the efficiency of the execution of the roles and responsibilities of the Board in conformance with the requirements of the SEC and of the BSP.
As reported by the external facilitator, the Bank’s overall corporate governance is effective and substantially compliant with all the regulatory requirements being met by the Board of Directors, Board Committees, and Chairman of the Board.
The results of the self-assessment were presented to the Board in its May 2021 meeting and various recommendations had been addressed in the same year.
Remuneration
The Board of Directors receive a fixed remuneration package based on market practice, experience, professional background, level of responsibilities and attendance in Board and committee meetings.
