17.— The Principal Act is amended by substituting the following for section 55:

“55.— (1) Without prejudice to the generality of section 53(1), the functions of the board of directors of a credit union shall include the following:

(a) setting the strategy for the credit union by preparing, including active participation and examination of strategies being developed or proposed by the manager, management team or others and preparing and adopting a strategic plan;

(b) monitoring the implementation of the strategic plan by the credit union, reviewing the performance of the credit union against the measurements defined in the strategic plan and assessing, on a regular basis but at least annually, how the strategic objectives of the credit union are being achieved;

(c) reviewing the credit union’s strategic plan on a regular basis, but at least annually, to ensure that it remains relevant and up to date and modifying or revising the strategic plan to incorporate any changes required as a result of the review;

(d) operating a comprehensive decision-making process, considering all matters it considers to be of material relevance to the credit union and documenting the reasons for its decisions;

(e) the appointment of a manager, risk management officer and compliance officer and the approval of the appointment of any other member of the management team;

(f) ensuring that there is an effective management team in place;

(g) reviewing the performance of the manager on an annual basis and monitoring on an ongoing basis his or her continued appropriateness to be the manager;

(h) ensuring that the performance of every other employee and voluntary assistant, is reviewed and monitored on an ongoing basis to ensure his or her continued appropriateness for his or her role in the credit union;

(i) identifying, in consultation with the manager, other officer positions within the credit union that—

(i) are essential to the proper management of the credit union,

(ii) are likely to enable the person holding the position to exercise significant influence on the conduct of the affairs of the credit union,

and which, together with the manager and risk management officer of the credit union are referred to in this Act as the ‘management team’;

(j) ensuring there is an appropriate succession plan in place in respect of each of the positions that constitute the management team;

(k) exercising appropriate oversight over execution by the management team of the agreed strategies, goals and objectives;

(l) reviewing and approving all elements of the risk management system on a regular basis, but at least annually and, in particular—

(i) assessing the appropriateness of the risk management system,

(ii) taking account of any changes to the strategic plan including the credit union’s resources or the external environment, and

(iii) taking measures necessary to address any deficiencies identified in the risk management system;

(m) ensuring compliance with all requirements imposed on the credit union by or under the Credit Union Acts 1997 to 2012 or any other financial services legislation;

(n) the removal from office of an officer of the credit union, except directors or members of the board oversight committee, where the board of directors has duly determined that there has been a failure by the person concerned to perform duties or responsibilities;

(o) approving, reviewing, and updating, where necessary, but at least annually, all plans, policies and procedures of the credit union, including the following:

(i) lending policies including lending limits;

(ii) policies in relation to members’ shares and deposits including the setting of a maximum number of shares a member can hold and a maximum amount that a member may deposit;

(iii) liquidity management policies;

(iv) reserve management policies;

(v) investment policies;

(vi) the designating of depositories for the funds of the credit union and signatories to cheques, drafts or similar documents drawn on thecredit union;

(vii) standards of conduct and ethical behaviour for officers;

(viii) remuneration policies and practices;

(ix) compliance plan and policies;

(x) records management policies;

(xi) information systems and management information policies;

(xii) business continuity plan;

(xiii) asset and liability management policies;

(xiv) outsourcing policies;

(xv) risk management policy;

(xvi) conflicts of interest policy;

(xvii) such other matters as the Bank may prescribe;

(p) the recommendation to members, for approval, of dividends to members;

(q) ensuring the accounts of the credit union are submitted for audit;

(r) reporting to the members of the credit union at the annual general meeting, including nominating a member of the board to present the annual accounts at the annual general meeting;

(s) reviewing and considering any update of financial statements provided to the board by the manager under section 63A(4)(c).

(2) In deciding on the roles, responsibilities and administrative structures and reporting relationships of all officers, the board of directors of a credit union shall ensure that no single person is responsible for making all of the material decisions of the credit union or has effective control over the business of the credit union.

(3) The board of directors shall implement a risk management process that ensures that all significant risks are identified and mitigated to a level consistent with the risk tolerance of the credit union.

(4) The board of directors shall carry out at least annually a comprehensive review of its overall performance, relative to its objectives and implement any necessary changes or improvements.

(5) The review carried out by the board of directors under subsection (4) shall be documented in writing.

(6) In respect of the exercise of functions by the board of directors of a credit union, the board shall set out in writing a register of matters or categories of matters that require the board’s approval and which cannot be assigned by the board to other persons for performance on the board’s behalf. The register shall be used to record all such approvals by the board of directors.

(7) Where the board of directors causes any matter relating to its functions to be performed or carried out on its behalf, it shall continue to have responsibility for the matter.

(8) The board shall regularly review, but at least annually, the performance and effectiveness of the internal audit function, including reviewing and approving the internal audit charter and the internal audit plan and reviewing and approving any modifications to them, ensuring they are updated and that any issues identified in the review are managed and rectified in a timely manner.”.