They give special attention to the composition of the Boards of banks and their operation, the limitations on tenure of office, the importance of independent directors, the qualifications of Board members, the responsibilities of the Board and its various committees, and the operation of the audit function.
Besides complexities of capturing and estimating all types of risks, concerns regarding contagion of volatility in one segment of the market to another, have motivated BIS to define more elaborately the requirements for safeguarding the financial sector by introducing stringent prudential regulation, restraints on counterparty exposures, using joint conglomerate supervision systems to keep a vigilance on risk exposures and, verifying the corporate governance standards by trying to keep them as uniform as possible.