How to influence control environment of a banking institution / Implementing control culture in a Banking institution of a Banking institution? (5 marks)
Banking institution likely will have large pool of labour, control environment seeks to influence bank's culture, the way we behave or do things here, attitudes & values.
Directors' communication
BOD could by rotation conduct an in-house training to communicate the bank's values & serious commitment to effective internal control.
NEDs (Non-executive director) participation
Audit committee can work with IA to determine the level of skills required on staff's competence. Then advise Human Resource Department to select new recruits that demonstrates such capabilities.
Management's philosophy
Management & BOD can use mission statement, vision & objectives as tools to communicate the values that Bank believes. Have in place negative & positive disciplines to enforce compliance. Example, if bank staff is reckless risking Shareholder's fund, demotion or warning letter are in order.
Organisation structure
Create a new position, Executive Operating Officer on Quality Assurance to influence policies & balance business risk & controls. The senior post will override reckless cultural behaviour on the user department level.
Human resource policies
Training & recruitment to emphasis/corporate values & ethics to have professional due care when carrying out customer relationship activities such as approving loans, credit risks must reflect the corporate sensitivity in taking risks.
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