BAKU, Azerbaijan, October 20. The Central Bank of Azerbaijan (CBA) plans to incorporate some of its existing recommendations on corporate governance in the banking sector into binding regulatory requirements, with a draft proposal expected to be presented to banks for discussion in the near future, TurkicWorld's correspondent reports from the event.
CBA Deputy Chairman and Board Member Togrul Aliyev announced the plans on Tuesday at the Sustainable Business, Corporate Governance, Risk and Compliance (GRC) Conference in Baku.
According to Aliyev, information and cybersecurity risks have become major risk areas across the financial sector. Effective management of these risks is particularly important for ensuring the sector's resilience.
He noted that the CBA regularly updates its corporate governance standards. In 2024, the regulator adopted a set of recommendations on improving corporate governance in the banking sector.
"These recommendations guide the banking sector in adapting to new developments and best practices in corporate governance and preparing for more advanced regulation. They also indicate the direction in which the Central Bank's corporate governance requirements may evolve in the future," he said.
The deputy chairman emphasized that the CBA is working to incorporate provisions from these recommendations into the regulatory framework to help bring corporate governance in the banking sector to the next level.
"Internal discussions on this matter are already underway. We intend to share the relevant draft with the banking sector in the near future. Feedback from banking professionals is very important to us," Aliyev said.
He noted that sustainable corporate governance cannot be ensured through regulatory requirements alone. Support from organizational leaders, the professionalism of risk management and compliance functions, and employees' knowledge and skills also play an important role.
According to Aliyev, professional certification and development are important issues for both financial institutions and regulatory authorities.
He added that exchanging experience and discussing international best practices are essential to the development of governance, risk and compliance (GRC). Aliyev expressed hope that the conference would contribute to further improving corporate governance, risk management and compliance practices in Azerbaijan.
