Corporate governance. A set of relationships between a company’s management, its board, its shareholders and other stakeholders which provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance. It helps define the way authority and responsibility are allocated and how corporate decisions are made.
Some components:
- Board and Senior Management Oversight. Provide oversight and leadership on AML/CFT issues. This includes setting policies and procedures, providing adequate resources, ensuring that ML/TF/PF risks are effectively managed, and promoting a well-grounded culture of compliance.
- Risk Management. Risk-based approach to AML/CFT appropriate for their size, complexity, and risk profile. This includes setting an ML/TF/PF risk appetite and risk tolerance, conducting ML/FT risk assessments and monitoring for ML/TF/PF risks, and implementing appropriate risk mitigation measures.
- Policies and Procedures. Tailored to specific risks and business activities: customer due diligence (CDD), ongoing monitoring, reporting suspicious activity, record keeping, and training employees.
- Internal Controls. Trained employees on AML/CFT issues and aware of reporting and escalation lines, and adequate separation of powers and functions, and regular review of risks.
- Compliance. Continuous monitoring of the effectiveness of the AML/CFT program.
- Audit. Assessment of the effectiveness of their AML/CFT program: Adequacy of policies and procedures, verifying compliance with applicable laws and regulations, and providing recommendations for improvement.
