Presenting Compliance to the Board of Directors

Much time has been spent addressing the "buy-in" of the board of directors at all banks to the importance of having a culture of compliance. The best way to counter the question about where the board was when a significant risk that developed over time surfaces is to show that the board was exercising its duty and was informed and educated. Members of the board of directors of every company have a duty of loyalty and a duty of care to the company. Directors of community banks have these same duties in addition to a number of other responsibilities. To fulfill their obligations and to understand fully the implications of compliance matters, board members must ask questions, attend meetings, and read the examination reports, audits and other materials that are provided to them. At the same time, it is important to provide the information necessary to ensure that directors are informed.