Corporate governance
Since the establishment of the first credit cooperative in 1895 the governance of Rabobank has often
been adapted.The year 2015 marks an important point in the history of Rabobank, for in December
the local Members Councils took an historic decision: following intensive discussions, they took the
unanimous decision to merge all local cooperative Rabobanks and the cooperative central organisation
(Rabobank Nederland). A week later, the local cooperative banks, as members of Rabobank Nederland,
took the same decision at their General Meeting. The result: one cooperative Rabobank with one
balance sheet and one, single banking licence.
Contents Management report Corporate governance Consolidated financial statements Financial statements Pillar 3
The new corporate governance is designed to strengthen both
our cooperative and our banking business.This fundamental
change marks the end of a long chapter in our history,
modernising the cooperative principles of our organisation.
Rabobank remains a participatory organisation that embodies
cooperative values and principles. Members (representatives)
have the right, the opportunity and the responsibility to
approve the bank's strategy and objectives.
In legal terms, the merger on 1 January 2016 resulted in
one legal entity with one financial statement: Coöperatieve
Rabobank U.A. (Rabobank). The member banks and their assets
have been merged into one Rabobank. Internal financial
reporting will remain in place for internal purposes to ensure
clarity on the origin of local Rabobanks'assets, inter alia,
and to help determine the voting in the General Members
Council, the highest member body in the new governance.
The merger means that the members, clients and employees
of local Rabobanks automatically become members, clients
and employees of Rabobank.The previous system in which
Rabobank Nederland exercised delegated prudential
supervision over local cooperative Rabobanks no longer applies.
The new governance model will not change the domestic
retail banking of Rabobank, which will still be based on
a decentralised organisation of the local Rabobanks. However,
a local Rabobank is no longer a separate legal entity with
its own banking licence. Also, local member councils, local
supervisory bodies and local management teams are no
longer statutory bodies automatically assigned certain duties
and powers under Dutch Civil Code. Nonetheless, from
a management and organisation perspective, these bodies
remain crucial to the internal governance and to determination
of the strategic direction of the Rabobank organisation.
Moreover, the new governance firmly anchors members'
disciplinary influence both locally and collectively. For example,
Rabobank's members are represented indirectly in the highest
decision-making body, the General Members Council.
Under the new governance, the Executive Board is accountable
for all of Rabobank's banking activities including those of local
Rabobanks.The Executive Board assigns specific local powers
to the chairmen of local Rabobanks' management teams and
local supervisory bodies.These duties and responsibilities
are prescribed in the regulations.This is discussed in more
detail below. The powers granted by the Executive Board
are primarily intended to safeguard the local focus and local
entrepreneurship of local Rabobanks within collectively agreed
frameworks. To this effect, the management teams of the local
Rabobanks are responsible for local ambitions in terms of
customer, market and field of operation.
The figure below shows the organisational entities in the
new structure. The left side of this figure relates to the
cooperative pillar, the right side relates to the banking business.
The orange circle symbolises the unity of the cooperative
and bank. The new governance bodies and their duties and
responsibilities are described and discussed below in general
terms. Some differences with the old governance structure are
also discussed.
154 Rabobank Annual Report 2015
