HSBC 2012 Annual Report Download - page 321

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Overview Operating & Financial Review Corporate Governance Financial Statements Shareholder Information
The GMB is a key element of our management
reporting and control structure such that all of our
line operations are accountable either to a member of
the GMB or directly to the Group Chief Executive,
who in turn reports to the Group Chairman. The
Board has set objectives and measures for the GMB.
These align senior executives’ objectives and
measures with the strategy and operating plans
throughout HSBC.
The Group Chief Executive (who is Chairman
of the GMB) reports to each meeting of the Board
on the activities of the GMB.
Regular Risk Management Meetings of GMB,
chaired by the Group Chief Risk Officer, are held
to establish, maintain and periodically review the
policy and guidelines for the management of risk
within the Group.
Regular Global Standards Steering Meetings of
the GMB, co-chaired by the Group Chief Risk
Officer and Group Chief Legal Officer, are held to
develop and implement global standards reflecting
best practices which must be adopted and adhered to
consistently throughout the Group.
Group Audit Committee
The Group Audit Committee (‘GAC’) has non-
executive responsibility for oversight of, and advice
to, the Board on matters relating to financial
reporting and for non-executive oversight of internal
controls over financial reporting.
Meetings
attended
Meetings
eligible
to attend
Members1
J D Coombe (Chairman) ......... 5 5
M K T Cheung ........................ 5 5
R A Fairhead ........................... 5 5
J R Lomax ............................... 5 5
Meetings held in 2012 ........... 5
1 All members are independent non-executive Directors.
R Fassbind was appointed a member of the
GAC on 1 March 2013.
The Board has determined that M K T Cheung,
J D Coombe, R A Fairhead, R Fassbind and
J R Lomax are independent according to SEC
criteria and may be regarded as audit committee
financial experts for the purposes of section 407 of
the Sarbanes-Oxley Act and have recent and relevant
financial experience for the purposes of the UK
Corporate Governance Code.
The governance structure for the oversight of
financial reporting is set out below. Each major
operating subsidiary has established a board
committee with non-executive responsibility for
oversight of matters relating to financial reporting.
Governance
Authority Membership Responsibilities include:
Board Executive and non-
executive Directors
• Financial reporting
• Appoints senior financial officers
• Delegates authorities in relation to financial matters
GAC Independent non-executive
Directors
• Monitors the integrity of financial statements
• Oversees the internal control systems over financial reporting, including reviewing their
effectiveness
• Monitors and reviews the effectiveness of the internal audit function
• Reviews the Company’s financial and accounting policies and practices
• Advises the Board on appointment of the external auditor and is responsible for oversight and
remuneration of the external auditor
Disclosure
Committee
Representatives from
global businesses,
functions and certain
Group companies
• Reviews the Group’s material communications with investors
• Assists the Group Chief Executive and Group Finance Director to discharge thei
r
obligations relating to financial reporting under the Securities Exchange Act of 1934
• Monitors and reviews the effectiveness of controls and procedures established to ensure
that information is disclosed appropriately and on a timely basis
• Reports findings and makes recommendations to the Group Chief Executive, Group
Finance Director and the GAC
Subsidiary board
committees
responsible for
oversight of
financial
reporting and
global business
audit committees
Independent non-executive
directors and/or
independent members, as
appropriate
• Provide certification to the GAC or intermediate audit committee on financial statements and
internal controls over financial reporting of relevant subsidiaries or businesses, as appropriate