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Times They Have Met: Corporate Governance and Oversight in Mauritius

In a bid to strengthen corporate governance practices in the financial sector, Mauritius has introduced several initiatives aimed at promoting transparency, accountability, and fairness. In this article, we explore the key measures taken by the country’s banking institutions to ensure good governance and oversight.

Financial Institutions’ Objectives and Governance Structure

According to the Bank of Mauritius (BoM) Guidelines on Public Disclosure of Information, financial institutions are required to disclose their objectives, governance structure, and policies. This includes information on:

  • Major shareholdings and voting rights
  • Related-party transactions
  • Remuneration and compensation policy
  • Criteria for performance measurement

National Code of Corporate Governance 2016

The Ministry of Financial Services, Good Governance and Institutional Reforms has issued the National Code of Corporate Governance 2016 (Code), which aims to guide boards of directors in complying with governance practices. The Code is designed to promote:

  • Accountability
  • Fairness
  • Transparency
  • Reporting
  • Minimizing risks within companies

Code of Ethics and Code of Banking Practice

The Mauritius Bankers Association (MBA) has issued the Code of Ethics and Code of Banking Practice, which sets out a common set of principles for banks to follow. The codes aim to:

  • Promote transparency
  • Enhance relationships between banks and customers
  • Promote fairness and good banking practices

Registration and Oversight of Senior Management

The Banking Act 2004 requires banks to appoint and supervise directors and senior officers, while the BoM must be satisfied that these individuals are fit and proper persons. The BoM has issued a Guideline detailing the fit and proper criteria for assessing:

  • Directors
  • Senior officers
  • Shareholders holding significant interests

Fit and Proper Criteria

According to the Guideline, a fit and proper person is one who presents the likelihood of being in a position to discharge their responsibilities in a competent, honest, and correct manner in the best interests of the institution. The key criteria include:

  • Competence and capability
  • Honesty
  • Integrity
  • Diligence
  • Fairness
  • Reputation
  • Good character

Conclusion

Mauritius’ efforts to promote corporate governance and oversight are aimed at ensuring transparency, accountability, and fairness within the financial sector. By implementing these initiatives, the country is reinforcing its commitment to upholding high standards of corporate governance across the African continent.