Governance

Board of Directors

The Board of Directors of Lanka Rating Agency (“LRA” comprises professionals drawn from diverse fields. Three Directors are Non-Executive and Independent,this includes the Chairman,Deputy Chairman and the Chairman of the Audit & Compliance Committee .The day-to-day management of the Company is conducted by the Chief Executive Officer subject to the supervision and control of the Board of Directors. LRA Board plays a pivotal role in ensuring good governance. The Board’s role, functions, responsibility, and accountability are clearly defined. Primary role of Board is to assess the overall direction and strategy of the business by overseeing the day-to-day operation of the business and foster an environment that encourages ethical conduct and a commitment to legal compliance. In order to further its goal of sound governance practices, the board also plays a substantive role in establishing a policy based governance system, reviewing and amending its bylaws periodically as necessary, avoiding conflicts of interest or even the appearance of them, identifying complaints in their various forms and ensuring they are investigated by the right people and fiduciary duty to protect the LRA s assets and members’ investment.

The rating committee members comprises of experienced professionals from Sri Lanka and Pakistan,which gives the essential input for sound credit decisions,and the appeal rating committee members are completely independent from the day to day rating committee members. LRA technical affiliation partner is Pakistan Credit Rating Agency (“PACRA”) who provides the technical assistance and training.

LRA has a seperate compliance officer to ensure that LRA’s is in compliant with international standards,the compliance officer reports to the Chairman audit and compliance committee.

Code of Conduct for Board of Directors

PACRA observes the highest standard of integrity and fairness in all their dealings. The Directors are expected to articulate and demonstrate high standards of honesty and integrity. They are required to observe ethical and law abiding behaviour in the organization. The BOD is responsible for setting up the standards of conduct in accordance with the regulatory requirements and the best practices. The BOD is expected to understand the prevailing Code of Conduct (by SEC, IOSCA, ACRAA and Other regional good practices) and uphold these standards and ensure compliance. PACRA’s BOD affirm compliance to SECP approved code for PACRA on an annual basis. The current Code of Conduct has been adopted by the BOD in their 67th Meeting held on 18th June, 2010. The Board takes care of:

1. Compliance with laws, rules & regulations
2. Ethical conduct
3. Confidentiality
4. Conflict of interest
5. SEC restriction on Directors of Credit Rating Companies
6. Insider trading
7. Gifts
8. Reporting of any illegal or unethical behavior
9. Protecting company assets
10. Waivers and Modifications