HSBC 2015 Annual Report Download - page 274

Report of the Directors: Corporate Governance (continued)
Board committees
HSBC HOLDINGS PLC
272
Conduct & Values Committee
I am pleased to present the 2015 report of the Conduct & Values
Committee (‘CVC’). The CVC has non-executive responsibility for
overseeing the Group’s continuing efforts to raise standards in
the way it conducts business, consistent with HSBC’s values.
In this, the second year of its operation, the Committee has
focused particularly on the implementation of the Group’s global
programme for ensuring that it delivers fair outcomes for
customers and upholds market integrity, as the basis for the
long-term success of its business.
This has involved a thorough review of Group policies, processes
and procedures to assess how far they meet the required
standards and, where necessary, to implement remedial action.
A key challenge has been to develop measures that will enable
management to identify and resolve emerging conduct issues in
a timely way. The CVC is monitoring progress in developing
useful management information in each of the global businesses
and across the different geographies.
The Committee recognises that the success of any programme of
cultural change depends critically on how people are recruited,
trained, incentivised and led. It is taking a close interest in the
many initiatives that are being developed to ensure that the
Group sends consistent messages to employees about what is
expected of them, equips them to do their jobs in the right way,
and rewards and penalises them appropriately.
It is particularly important to foster a culture in which people are
empowered to speak up if they become aware of problems.
During 2015 the CVC has overseen a significant improvement in
the Group’s whistleblowing arrangements. HSBC Confidential,
launched in August, provides simplified access to whistleblowing
channels which will enable more timely and consistent reporting
of cases.
Looking ahead, the CVC will remain focused on how the Group’s
conduct approach is being implemented. It will pay particular
attention to how effectively global programmes are being
cascaded through the organisation, especially in the Group’s key
locations, using staff surveys, site visits and internal audits as
appropriate.
As part of its remit to ensure that the Group acts responsibly
towards the communities within which it operates, the
Committee intends to review how effectively the Group seeks to
satisfy itself that it is meeting its sustainability commitments.
I should like to take this opportunity to thank all Committee
members and management for their contributions during the
year. Heidi Miller stepped down from the Committee on
31 December and Pauline van der Meer Mohr joined with
effect from 1 January: my warm thanks to Heidi for her lively
participation in the Committee’s work, and a hearty welcome
to Pauline.
Rachel Lomax
Chairman, Conduct & Values Committee
22 February 2016
Members
Rachel Lomax (Chairman)
Laura Cha
Lord Evans of Weardale
Heidi Miller (until 31 December 2015)
Jonathan Symonds
Pauline van der Meer Mohr (from 1 January 2016)
Role and responsibilities
The role and responsibilities of the CVC are set out in its
terms of reference which can be found on our website at
www.hsbc.com/about-hsbc/corporate-governance/board-
committees.
The CVC is responsible for:
• policies, procedures and standards to ensure that the
Group conducts business responsibly and consistently
adheres to HSBC Values. It aims to align its work to
HSBC’s purpose of connecting customers
to opportunities, enabling businesses to thrive and
economies to prosper, and ultimately helping people
to fulfil their hopes and realise their ambitions; and
• ensuring that in the conduct of its business, the Group
treats customers fairly and openly, does business with
the right clients and in the right way, is a responsible
employer, acts responsibly towards the communities
in which it operates and treats other stakeholders fairly.
The CVC oversees the promotion and embedding by
management of HSBC Values and its required global
conduct outcomes. The CVC also provides inputs, as
appropriate, to the Group Remuneration Committee on the
alignment of remuneration with conduct.
In 2016, the CVC will relinquish, and the Financial System
Vulnerabilities Committee will assume, responsibility for
oversight of controls relating to anti-bribery and
corruption.
Governance
During 2015, the CVC held five meetings. Attendance is set
out in the table on page 258.
The Chairman reports matters of significance to the Board
after each meeting and the minutes of the meetings are
made available to all Board members.
How the CVC discharged its responsibilities
During the course of 2015 the CVC received regular reports
and presentations from global business and functional
heads.
The chief executives of the global businesses provide
regular reports to the CVC, including an analysis of
customer complaint trends, at each meeting. The CVC also
receives reports on whistleblowing cases, the outcomes of
internal audits and initiatives to embed values-based
leadership as part of the Group’s ongoing cultural
transformation.
Committee effectiveness
The effectiveness of the CVC was evaluated as part of the
overall performance evaluation of the Board.