Drawing from my extensive experience in Ghanaian banking governance, including advising on committee structures at GCB Bank post-2019 cleanup, the Remuneration Committee (RemCo) is pivotal under BoG’s Corporate Governance Directive 2018 (Section 68), which mandates alignment with Basel III Pillar III for transparent disclosures on remuneration to mitigate excessive risk-taking. Pillar III requires disclosures on pay structures to ensure they promote sound risk management, as adapted in Ghana’s CRD. The current TOR shortfall in strategic linkage risks misalignment with bank objectives like profitability and sustainability, akin to global failures where poor remuneration led to risky behaviors (e.g., Merrill Lynch pre-2008 crisis). In Ghana, post-DDEP recovery emphasizes variable pay tied to long-term performance to avoid short-termism.

Critically examining the main responsibilities:

1. Design and Recommend Remuneration Policies (5 Marks): Develop policies linking pay to strategic goals, e.g., CET1 restoration post-DDEP. Critically, this includes clawback provisions for misconduct, per BoG Directive, to prevent ethical breaches like insider trading. Example: Ecobank Ghana ties 40% of executive bonuses to ESG metrics.
2. Oversee Executive Compensation Structures (5 Marks): Approve CEO and senior pay, ensuring no duality conflicts. Include deferred incentives under Basel III to align with risk horizons. Critically, this curbs excessive bonuses, as in the UT Bank collapse due to unchecked executive perks.
3. Ensure Compliance with Regulatory Disclosures (5 Marks): Mandate Pillar III reports on aggregate remuneration, broken by fixed/variable. In Ghana, this involves BoG submissions for approval, enhancing transparency and preventing systemic risks like the 2017 cleanup.
4. Align Remuneration with Risk Management (5 Marks): Integrate with EWRM, adjusting pay for risk-adjusted performance. Critically, this addresses stakeholder model concerns, referencing South Africa’s King IV Code for balanced incentives.
5. Monitor and Review Effectiveness (5 Marks): Annual evaluations of policies against strategic objectives, with independent advice. Practical: Stanbic Bank Ghana uses external consultants for benchmarking, ensuring competitiveness and ethical standards under Act 930.

These responsibilities, when embedded in TOR, foster a comprehensive framework, promoting ethical leadership and bank resilience.