Bank Of Sharjah P J S C : Corporate Governance Report 2022

Bank of Sharjah

Corporate Governance Report 2022

Opening Statement

While we are proudly stepping into the year that marks Bank of Sharjah 50th anniversary, I am pleased to state that the Bank has a strong and effective governance framework based on global best practice, as set out by the Central Bank of the United Arab Emirate (CBUAE), the Securities and Commodities Authorities (SCA) as well as international bodies.

Our five decades track of quality in performance, commitment, integrity and transparency and continuous efforts we deploy to ensure regulatory compliance provide the foundation for the Bank's long-term success and are to the level of satisfaction of all stakeholders.

The Board and its various committees provided appropriate direction and guidance to the Bank in 2022 duly supported by various Charters, Terms of Reference and Policies.

Bank of Sharjah is committed to full compliance with these regulations, in line with our long-standing approach to fair treatment of customers and transparency. Additionally, while Bank of Sharjah has accelerated its efforts and initiatives towards digital transformation, the Bank is continuously striving to present the most secure and enhanced platforms by ensuring data privacy and cybersecurity management as a main priority to guarantee consumer protection.

I am pleased to announce that In line with the targets set by the CBUAE and MOHRE, Bank of Sharjah has successfully fulfilled in 2022 its commitment to Emiratization as part of its ongoing drive for greater diversity across the organization.

The Board and Senior Management fully support the development of a robust and relevant ESG framework which, going forward will be imbedded within the Bank's strategy. The Bank has highlighted in its ESG Report 2022 the alignment of its efforts in both Governance and Sustainability, and will ensure that this will remain an institutional priority going forward.

Last, I would like to thank all Board Members, the Management and staff of the Bank, our valued employees and all stakeholders for their continuous efforts and contribution into maintaining the highest standards and instilling a culture of responsibility and commitment.

On behalf of the Board of Directors, I am honored to present Bank of Sharjah Corporate Governance Report for 2022.

Sh. Mohammed Bin Saud Al Qasimi

Chairman

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Corporate Governance Framework

Bank of Sharjah's approach to Corporate Governance

Bank of Sharjah believes Corporate Governance to be the guiding force that determines how the organization is directed and controlled. Effective Corporate Governance, that is appropriately aligned with relevant regulations and international best practices, is the basic tenet of Bank of Sharjah's business philosophy.

As a Bank whose fundamental value is to maintain the highest ethical standards, Bank of Sharjah strives to compete only on the basis of quality of services we provide to our customers. The success of the Bank's business is dependent on the trust and confidence it earns from our shareholders, customers, and employees.

The Corporate Governance function in the Bank is mandated to stipulate, institute and monitor a group-wide corporate governance framework and to act as its guardian.

Corporate Governance is the core foundation of any business activity and without it, the business would begin to suffer. Governance is a holistic approach to the management and organization within a firm which, if directed in a comprehensive manner can make a substantial difference to the business's success and its long-term sustainability; it feeds into all areas of the business.

It establishes and preserves management accountability to shareholders by appropriately allocating rights and responsibilities among Board members and managers. It provides a structure for management and the Board to set objectives and monitor performance.

Corporate Governance strengthens and safeguards the Bank's culture of business integrity and responsible business practices. It encourages the efficient use of resources and establishes accountability for stewardship of those resources.

Ethical and responsible business practices have been embedded in the Bank's culture since its inception in 1973. The Bank focuses on transparency and disclosure to ensure it is in line with the best international standards and practices. The Bank continuously strives to enhance the level of trust amongst its stakeholders. The Corporate Governance framework within the Bank is governed by the model set by the UAE Central Bank and the regulations of the Securities & Commodities Authority (SCA), the Federal and local legislations such as the National Electronic Security Authority (NESA) as well as Basel III Corporate Governance updates and CBUAE Corporate

Governance Regulations and Standards of 2019 and the Bank's Articles of Association.

Bank of Sharjah has remained sustainable despite the numerous financial crises over the years. This is a strong reflection of the underlying good governance by the Board of Directors and the Management.

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The Board of Directors

The Board of Directors of Bank of Sharjah consists of 11 members, it has met (6) times in 2022, in line with the best practices, the Board exclusively comprises non- executive directors with at least a third of its members who are Independent. Throughout the year, the Directors received detailed information on a regular basis regarding

the activities of the Board Committees, Management Committees as well as major developments at the level of the Bank's operations.

The various Board Committees met 20 times throughout 2022, the Board of Directors heads the governance structure of the bank. The Board created seven Board Committees, with specific roles and responsibilities delegated to each. In addition, in order to ensure effective achievement of the Bank's goals, the Bank's management created ten management committees, devoted to the day-to-day management of the business. This structure aims to ensure effective achievement of the Bank's goals, promote transparency, accountability, and ethical behavior, and comply with regulatory requirements.

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