Audits
Product approval
The product approval process has been organised at group level. At the end of 2010, a group
framework came into effect that describes Rabobank Group's policy on the product approval
process and focuses on safeguarding product quality. Standards also apply to product approval
procedures and their organisation, as well as to individual product testing by group entities. In
this way, Rabobank is taking responsibility for its relationship with customers and for the level
of quality it offers. Group Audit checks whether the product approval process has been
designed properly, is present and is working effectively.
The Executive Board has audits carried out by Group Audit, which holds an independent
position within the organisation. Every year, this department performs audit procedures, based
on an extensive risk assessment and an audit plan based on this assessment, in order to check
whether the internal control and risk management systems are in order. The director of Group
Audit reports directly to the Chairman of the Executive Board and has a direct reporting line to
the Audit, Compliance Risk Committee of the Supervisory Board. Tripartite talks between the
independent external auditor, Group Audit and regulators from the Dutch Central Bank (DNB)
are held at least once a year. The matters that come up for discussion at these meetings
include risk assessments, the audit plan and audit findings. The Annual Report includes a
statement by the Executive Board to the effect that the internal risk management and control
systems are designed such that the financial reports can be considered to be reliable.
Remuneration policy
The Dutch Banking Code contains principles for a prudent, restrained and sustainable
remuneration policy that incorporates non-financial performance criteria. The rules governing
remuneration policy focus on the long term and on the avoidance of unwanted incentives
with regard to risk. Rabobank endorses these guiding principles. Rabobank pursues a prudent,
restrained and sustainable remuneration policy, which is in line with Rabobank's strategy,
chosen risk profile, cooperative identity and core values.The remuneration policy is in keeping
with a client-oriented approach and takes account of Rabobank's long-term interests, the
international context of the markets in which Rabobank operates, and acceptance by society.
The pay outcomes are balanced and the performance criteria do not encourage employees to
take irresponsible risks.
Group Remuneration Policy
As in previous years, Rabobank continued to pursue a prudent and restrained risk policy in
2011which is reflected in the bank's remuneration policy. To find out more about the Group
Remuneration Policy, please consult the section on employees elsewhere in this Annual Report.
Severance pay: comply or explain
Members of the Executive Board appointed prior to 1 January 2010 receive severance pay
based on the subdistrict court formula in the event of their removal. This entitlement to
severance pay was laid down in agreements made previously with the relevant members of
the Executive Board and constitutes a departure from the relevant provision of the Banking
Code. As Rabobank has opted to comply with the provisions of the Banking Code, any
severance pay due to newly to be appointed members of the Executive Board will be governed
by the relevant Banking Code principle.
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Dutch Banking Code
