Code of Conduct - Nitol Insurance

Code of Conduct and Corporate Governance of Nitol Insurance Company Limited (Annexure- A) Code of Conduct for Directors Purpose: The Code of Conduct has been prepared to provide to guide as well as assist the Board and the Management to focus the roles and responsibilities of Board members and Management to facilitate the board's and management's accountability to the Company and shareholders as well as ensuring effective communication between the Board and Management. The Board and the Management team are dedicated to implement strong compliance and transparent business ethics and integrity at all levels of internal and external business conducts. Role of the Board: The Board is responsible for ensuring that the business activities are soundly managed and effectively administered. The Directors keep themselves informed about the company's financial position and make sure that its activities, accounts and asset management are subject to appropriate control. The Board also ensures that company’s Policies & Procedures and Codes of Conduct are practiced and maintained and the Company adheres to generally accepted principles for good governance. The Managing Director along with the Company Secretary conclude the agenda papers for the Board meeting in consultation with the chairman. The minutes of the proceedings of each Board meeting are maintained in terms of statutory provisions. Each Director has a legal obligation to act in the best interest of the Company. The Directors, mutually and individually, are aware of their responsibilities to shareholders and stakeholders of the Company. The Board sets the Company's values and standards and make certain that its obligations to its shareholders and stakeholders are acknowledged and met. Responsibility of the Board 1. Assess and approve strategic business plans, financial objectives, major capital and operating budget and matters of policy presented by senior management. 2. Observe senior management's performance to implement the adopted strategies and give relevant direction and guidance where necessary to senior management to ensure the achievement of the Company's objectives. 3. Review and approving performance objectives for senior management team and monitor senior management's performance on a constant basis to ensure high standard performance. 4. Appoint MD/CEO and ensure management team of the highest merit is in place to manage the Company. 5. Ensure, there is in place a succession planning strategy to replace senior management, when necessary. 6. Ensure that the Company is adequately capitalized to support the risks undertaken and to meet regulatory requirements, 7. Review the fairness and integrity of the Company's internal control system on a regular basis. 8. Ensure that there is an effective and satisfactory framework for reporting internal financial controls and regulatory compliance so that the Board and Management will receive relevant and reliable information on a timely basis avoiding any exposure to unmanaged financial and operational risks. Roles and Responsibility of the Directors 1. The members of the Board shall act sincerely, in good faith and in the best interests of the shareholders and the company. 2. The Board members will be obligated to be independent in judgment and actions and take all reasonable steps to be satisfied as to the soundness of decision taken by the board of directors. 3. Confidential information acquired by the members in the course of exercise of directorial duties shall remain the property of the company and it will be improper to disclose or allow it to be disclosed, unless that disclosure has been authorized by the company or legally mandated. 4. The members of the Board shall make every effort to attend all Board and Committee Meetings during their tenure. They will not absent themselves without good reasons or confirming leave of absence. 5. Board members having interest of any nature in the agenda of the meeting, shall declare beforehand the nature of their interest and withdraw from the room, unless they have a dispensation to speak. 6. Training opportunities/orientation/workshops will be arranged for the members (especially for the newly inducted members) to make them acquainted with the international best practices, their fiduciary obligations, Code of Conduct etc. 7. Board Members shall always maintain ‘Fit and Proper Test Criteria’, clean CIB status and other obligations declared by the Primary and other Regulators. 8. Conflict of Interest: Directors must avoid any conflicts of interest between the director and the Company. Any situation that involves, or may reasonably be expected to involve, a conflict of interest with the Company, should be disclosed promptly to the Chairman of the Board or the Chairman of the Audit Committee. A "conflict of interest" can occur when a director's personal interest is adverse to – or may appear to be adverse to - the interests of the Company as a whole. Conflicts of interest also arise when a director, or a family member, receives improper personal benefits as a result of his or her position as a director of the Company. This Code does not attempt to describe all possible conflicts of interest which could develop. Some of the more common conflicts from which directors must refrain, however, are set out below, Relationship of Company with third-parties: Directors may not engage in any conduct or activities that are inconsistent with the Company's best interests or that disrupt or impair the Company's relationship with any person or entity with which the Company has or proposes to enter into a business or contractual relationship. Compensation from non-Company sources: Directors may not accept compensation (in any form) for services performed for the Company from any source other than the Company. Gifts: Directors and members of their families may not accept gifts from persons or entities who deal with the Company in those cases where any such gift is being made in order to influence the directors’ actions as a member of the Board, or where acceptance of the gifts could create the appearance of a conflict of interest. Personal use of Company assets: Directors may not use Company assets, labor or information for personal use unless approved by the Chairman of the Audit Committee or as part of a compensation or expense reimbursement program available to all directors. Compensation from non-Company sources: Directors may not accept compensation (in any form) for services performed for the Company from any source other than the Company. 9. Corporate Opportunities Directors are prohibited from: (a) taking for themselves personal opportunities related to the Company's business; (b) using the Company's property, information, or position for personal gain; and/or (c) competing with the Company for business opportunities, provided, however, if the Company's disinterested directors determine that the Company will not pursue an opportunity that relates to the Company's business, a director may do so. 10. Compliance with laws, rules and regulations as well as fair dealings with others. Directors shall comply, and oversee compliance by employees, officers and other directors, with laws, rules and regulations applicable to the Company, including insider trading laws. The Directors will follow the rules and regulations of Dhaka/Chittagong Stock Exchanges and that of Bangladesh Securities and Exchange Commission for dealing in the securities of the Company. Directors shall oversee fair dealing by employees and officers with the Company's customers, suppliers, competitors and employees. 11. Encouraging the reporting of any illegal or unethical behavior. Directors should promote ethical behavior and take steps to ensure the Company: (a) encourages employees to talk to supervisors, managers and other appropriate personnel when in doubt about the best course of action in a particular situation; (b) encourages employees to report violations of laws, rules, regulations or the Company's HR Policies including Code of Conduct to appropriate personnel; and (c) informs employees that the Company will not allow retaliation for reports made in good faith. 12. Compliance procedures; waivers. Directors should communicate any suspected violations of this Code promptly to the Chairman of the Board. Violations will be investigated by the Board or by a person or persons designated by the Board and appropriate action will be taken in the event of any violations of the Code. 13. Indemnity The Directors will be indemnified against any liability incurred by them in defending any civil or criminal proceedings in which judgment is given in their favor or in which they are acquitted. Indemnification is also permitted where the court grants relief because the Director acted honestly and reasonably and ought fairly to be excused. 14. Interpretation and Amendment to the Code Any question on interpretation of any clause in this Code or an amendment to any provision of this Code shall be handled only by the Board of Directors. 15. Annual Disclosure All Directors shall issue an annual declaration confirming compliance with this Code. The Annual Report of the Company shall carry a certificate to this effect duly signed by the concerned. (Annexure - B) Responsibilities of the Chairman of the Board of Directors The Chairman is appointed by the Board with primary regard to his / her skills, expertise and experience relevant to the role and in accordance with the Memorandum and Articles of Association of the company. The Chairman provides leadership to the Board in matters relating to the effective execution of all Board responsibilities. He or she is expected to spend whatever time necessary to fulfill his or her duties. The Chairman presides over Board and General Meetings of the Company. He or she is expected to ensure that the Board is well informed and effective; that members, individually and as a group, have the opportunity to air differences, explore ideas and generate the collective views and wisdom necessary for the proper operation of the Board and the Company. Additionally, the Chairman must ensure that General Meetings too are conducted efficiently and that shareholders have adequate opportunity to air their views and obtain answers to their queries. In addition to the above, the responsibilities of the Chairman are to: 1. Provide effective leadership in formulating the strategic direction for the Company and the Board. He or she has overall responsibilities in the execution of the strategic, financial and operating plans and policies and the annual and long term business and financial results of the Company. 2. Monitor workings of the Board especially the conduct of Board meeting. This includes work with the Company Secretary to schedule Board and Board Committee meetings, liaise with the MD/CEO and the Company Secretary on the agenda, ensure that all relevant issues for the effective running of the Company's business are on the agenda and ensure that Directors receive accurate, timely and clear information in particular about the Company's performance, to enable the Board to make sound decisions, monitor effectively and provide sensible advice to achieve the Company's objectives. 3. Work with the Board in establishing appropriate Board Committee structures including the assignment of Directors to Board Committees and the appointment of Chairman of each Board Committee and Code of Conduct. The Code of Conduct should set out matters relating to the authority (in particular whether the Board Committee has the authority to act on behalf of the Board or simply has the authority to examine a particular issue and report back to the Board with a recommendation), functions, membership, operations and responsibilities of such Board Committees, and other matters that the Board may consider appropriate. 4. Ensure the independence of the Board in discharging its duties. This includes encouraging Non-Executive Directors of the Board to meet regularly to deliberate on matters of concern and ensuring that the Board may engage independent advisors as required (subject to the proper approval process). 5. Ensure that the Board and individual Directors fully exercise their responsibilities and fully comply with applicable policies, laws, regulations, rules, directives and guidelines. 6. Consider and address the development needs of individual directors and the Board as a whole; maintain the necessary depth and breadth of knowledge and skills to enhance the effectiveness of the Board as a team. 7. Work with the Board in establishing the performance criteria and evaluation for the Board, the various Board Committees, individual Directors, the MD/CEO and the senior management team. Within the evaluation framework, the Chairman shall encourage regular Board discussions and assessments of the MD/CEO and the senior management team's performance. 8. Promote effective relationships and open communication between the Board and senior management team, in relation to corporate governance matters and corporate performance. 9. Represent the Company and the collective views of the Board externally and overseeing the public relations, including relations with key clients, government officials, other public organizations and the public generally. In addition, the Chairman is encouraged to use his or her best endeavors to promote the Company's business in Bangladesh and overseas. Besides, the Chairman may/shall assume any other responsibility if the Board assigns within the purview of the Rules, Regulations, Acts and Articles of the company.

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