To strengthen bank governance and the accountability system, CCB recently released the Regulations on the Accountability of Senior Executives and the Higher Authorities of Units Where Law Cases Occur, according to which the system that senior executives shall take blame and resign, be ordered to resign or be dismissed will be implemented. The term senior executives in the Regulation covers all over CCB, i.e. all the senior executives of the headquarters, branches and sub-branches including the chairman of the board of directors, president and chairman of the board of supervisors of the headquarters. In addition to punishing the senior executives of those units which have serious breach of management duties, law cases or serious violation of regulations, CCB will ask them to take the blame and resign.

The Regulations stipulate clearly that under the following circumstances the CCB senior executives who make serious breach of duties shall take the blame and resign: more than one law cases or serious breach of rules and regulations occur in the units under their management, involve large amount of money or lead to huge losses, have very bad impact on the society or seriously frustrate the employees. In any of the following situations the senior executives will be punished severely: the law cases or breaches are discovered by the higher-level authorities or the regulatory authorities and the officials involved abscond; the officials try to cover the cases or breaches, if any, or make false report to the higher authorities; no effective rectification is made.

Once there is any senior executive who shall take the blame and resign as required by the Regulations, he or she should submit a resignation letter to the higher authority; otherwise the higher authority shall order the senior executive concerned to resign within a designated period of time or even dismiss the him or her if he or she fails to submit the resignation letter within the designated period of time.

As required by the China Banking Regulatory Commission to strengthen investigation of law cases and risk control, CCB reinforced the supervision and discipline of senior executives especially the top management at various levels. Since the latter half of April, CCB has launched a thorough investigation on the senior executives at all levels with the focus on those at the grassroots level. The investigation covers whether the executives fulfill their management functions in accordance with laws within their authority, whether they engage in agent services against related business procedures and how about the off-job economic responsibility auditing system of grassroots executives. The position of the executives who have insufficient leadership, are selfish or have insufficient skills will be readjusted. Whether the selection of the management at the sub-branch level complies with the standards is also investigated. Source of the CCB indicates that the bank will effectively improve the management and accountability of senior executives at all levels by using the supervision mechanism at senior, peer and employee levels.

To restrict the disciplines of employees and hold the violators of regulations responsible, the CCB released the Rules on the Disposal of Violations of Rules and Regulations by the Staffs of CCB as early as in 1998 which is the first of its kind among Chinese banks. Revised in 2002 and 2004 respectively, the Rules incorporated the disposal of the breach of duty, malpractice or violation of rules by senior executives at all levels. The launch of the Regulations helps improve the accountability system and efficient management of senior executives at all levels of the bank.