18. Risk Management and Internal Control
As per article 29 of the Banking Law, banks are obliged to establish and operate adequate and efficient internal control, risk
management and internal audit systems that are in harmony with the scope and structure of their activities, that can respond to
changing conditions and that cover all their branches and participations subject to consolidation in order to monitor and control the
risks that they encounter. Internal controlling activities carried out by the Bank’s employees with the awareness of responsibility, are
controlled and monitored by the Internal Control Division and the internal control personnel who report to the Board of Directors.
Risk Management activities are performed by the Risk Management Division and personnel who report to the Board of Directors.
Furthermore, banks have to establish internal audit systems that involve all their units, branches and participations subject to
consolidation. In this context, bank inspectors investigate the compliance of the banking activities to the legislation, articles of
association, internal regulations and banking principles.
İşbank’s internal audit, risk management and internal control systems have been established in accordance with the principles and
organization structures as required by domestic regulations in parallel with the best international practices. The units constituting
the internal systems are the Board of Inspectors, Internal Control, Risk Management and Corporate Compliance Divisions. The units
constituting the internal systems work under the Board of Directors. The effectiveness of the activities of the aforementioned units
is monitored by the Audit Committee and the Board of Directors.
Corporate Compliance Division works under the Board of Directors through the Audit Committee on issues regarding the regulation
and compliance and along with prevention of laundering of criminal proceeds and finance of terror. The basic objective of the
corporate compliance practices is to make the maximum contribution to ensure that the compliance risk at the Bank is managed
effectively and as targeted, thus kept under control and within this framework, the structure and implementation of the Bank’s
operations are carried out constantly in accordance with the rules, regulations and standards. In addition, the Corporate Compliance
Division, which is also responsible for the coordination of duties and activities related with compliance and compliance risk, has a
mutual communication and cooperation with other related Divisions and employees.
19. Strategic Goals of the Bank
The vision and objectives of İşbank were approved by the Board of Directors and disclosed to public via the Bank’s website. In this
context, İşbank’s vision is “to be the most preferred bank by customers, shareholders and employees by maintaining the leading,
pioneering and trusted position as a regional financial power” İşbank’s mission, in general, is described as meeting the needs of its
customers with fast, efficient and high standard solutions, increasing the value it created for its shareholders constantly and being
a bank that encourages employees for the maximum performance, and İşbank’s strategy is described as “sustainable and profitable
growth based on being “the bank closest to customers” philosophy in an effort to fulfill its vision and objectives. The Board of
Directors regularly monitors and supervises the performance of the Bank in terms of achieving the strategic goals. The Business
Programme that includes the yearly objectives formed according to the general strategic goals, comes into effect after approval by
the Board of Directors. The quarterly performance of the Bank in comparison with the objectives is reported comprehensively to the
Board of Directors.
20. Remuneration
İşbank carries out its activities regarding remuneration policies within the framework of the related banking regulations and Capital
Market regulations.
Monthly remunerations of the Board members are determined annually at İşbank’s General Shareholders’ Meetings and disclosed to
the Borsa Istanbul.
Benefits paid to key management personnel in 2013 amount to TL 15,401 thousands. Moreover, cost of allowance, travel,
accommodation, representation, as well as opportunities in cash and in kind, insurance and similar guarantees for key management
personnel in the same year amount to TL 5,506 thousands.
On the other hand, restrictions related with the loans to be extended by İşbank to the Board members and employees are defined in
article 50 of the Banking Law. In this context, İşbank does not extend loans to its Board members and employees other than those
allowed by the law.
As for the remuneration of the Board of Directors; article 58 of İşbank’s Articles of Incorporation contains the following expression:
“After the legal and extraordinary reserves fund and the first dividend have been allocated from the net profit, 0.25% of the
remaining balance is distributed among the members of the Board of Directors and the Chief Executive Officer equally.”
Corporate Governance
89
İşbank
Annual Report 2013
