Corporate Governance

This Corporate Governance Policy outlines the systems, structures and guiding principles that direct Central Credit Union’s leadership, decision-making and compliance practices. It aims to ensure effective governance that supports the organisation’s sustainability and member confidence.

The objectives of this policy are to:

  • Promote effective, transparent and accountable governance across all levels of the organisation.

  • Ensure full compliance with legal and regulatory requirements set by the PRA and FCA.

  • Protect members’ interests and uphold trust in the Credit Union.

  • Support the ethical, prudent and sustainable operation of the Credit Union.

The Board of Directors

The board is the governing body responsible for the strategic leadership, oversight, and stewardship of Central Credit Union. It ensures the Credit Union remains financially sound, legally compliant, and focused on delivering value to its members. Directors collaborate and are accountable for the organisation’s long-term success.

The Board’s core responsibilities include:

 

  • Strategic direction: Defining the Credit Union’s vision, mission, and long-term goals and regularly reviewing progress.

  • Financial oversight: Reviewing financial statements, ensuring accurate and timely regulatory returns, and maintaining adequate capital and reserves.

  • Risk oversight: Approving the risk appetite and ensuring the effectiveness of the risk management framework.

  • Governance: Developing and monitoring policies, including those related to ethics, conduct, and compliance.

  • Performance and succession: Appoint and assess the CEO, ensure succession planning, and annual evaluation of the Board’s performance. Appoint and assess the CEO, ensure succession planning, and annual evaluation of the Board’s performance.

Board composition and appointment

The Board will be composed of individuals who collectively bring a balance of skills, knowledge, experience, and independence. This includes:

  • Diversity of skills

    Financial literacy, legal understanding, cooperative values, and strategic thinking.

  • Regulatory approval

    All directors must meet the FCA and PRA “fit and proper” requirements.

  • Tenure and rotation

    Directors will serve fixed terms with periodic elections to maintain accountability and encourage fresh perspectives.

Senior management and key function holders

Senior managers are responsible for implementing Board-approved strategies and managing day-to-day operations. Key function holders (e.g., risk, compliance, internal audit) provide independent assurance and oversight.

They must:

  • Hold relevant qualifications and experience appropriate to their role.
  • Be individually approved under the SM&CR regime.
  • Demonstrate high standards of integrity, judgement, and leadership.
  • Foster a culture of openness, accountability, and risk awareness.

Accountability and controls

The Credit Union will implement a robust internal control environment, including:

  • Policies and procedures: Clear, documented procedures for all key activities.

  • Internal audit: An independent function to assess the adequacy and effectiveness of governance, risk management, and control processes.

  • Regulatory reporting: Timely and accurately submitting all returns required by the PRA and FCA.

  • Whistleblowing: Mechanisms to enable staff to report concerns confidentially and without fear of retaliation.

Risk management

Risk management is embedded across all operations, supporting sound decision-making and regulatory compliance.

  • Framework: A structured risk management framework identifies, assesses, mitigates, and monitors risks.

  • Risk register: A live document maintained and reviewed quarterly, capturing key strategic, financial, and operational risks.

  • Stress testing: Periodic scenario analyses are conducted to test the credit union’s resilience.

  • Responsibility: The Board owns the risk appetite, with oversight by a Risk Committee or designated officer.

Compliance

Regulatory compliance is fundamental to governance:

  • Legal framework: The Credit Union will adhere to all PRA and FCA regulations, including CRED, the Consumer Duty, and other relevant guidance.

  • Monitoring: A compliance function will conduct periodic reviews and assessments.

  • Training: Regular training and briefings will ensure staff are kept up to date with obligations and expectations.

  • Records: All compliance activities and breaches will be logged and reported as required.

Ethical standards and conduct

The Credit Union operates with integrity and fairness. All employees, directors, and volunteers are expected to:

  • Act honestly: Avoid deception, manipulation, or concealment.

  • Treat members fairly: Ensure decisions are just, non-discriminatory, and in members’ best interests.

  • Avoid conflicts: Disclose any conflicts of interest and remove themselves from decisions where a conflict exists.

  • Code of conduct: Abide by the Credit Union’s Code of Conduct, which sets out expected behaviours and consequences for misconduct.

Member engagement and accountability

Members are the heart of the Credit Union, and governance reflects this principle:

  • Communication: Regular updates on performance, products, and changes through newsletters, meetings, and digital platforms.

  • Democratic involvement: Members can vote at AGMs and stand for election to the Board.

  • Feedback and complaints: Transparent procedures for handling complaints and learning from member feedback.

  • Financial education: Provide resources that help members understand their rights and financial decisions.

Training and development

Effective governance depends on well-informed and capable people:

  • Induction: All new directors and senior managers will receive formal induction covering their responsibilities and key areas of the Credit Union’s business.

  • Continuous professional development: Ongoing training in governance, regulation, finance, and strategic planning will be provided.

  • Board evaluation: Annual assessments of Board performance and skills will inform training priorities and succession planning.

Review and Oversight

  • This policy will be reviewed annually or earlier if required by regulatory change.
  • The Governance Committee or equivalent will monitor compliance with this policy.
  • Revisions will be proposed by the Management Team and subject to Board approval.
  • Any breaches or material governance concerns will be reported immediately to the Board and, if necessary, to the PRA or FCA.

Annual reports

For a detailed account of our performance and strategic progress, please refer to Central CU’s Annual Reports from the past three years

Read our last 3 annual reports:
2023
2022
2021

Notice to members regarding redacted information

For commercially sensitive reasons, a small section of the annual report has been redacted from the version published online. This decision has been made to protect the financial interests of Central Credit Union and its members.

If you are a member and would like to receive the full, unredacted version of the report, please contact us at enquiries@clcu.co.uk and we will be happy to provide it to you.

Thank you for your understanding and continued support.