Corporate Governance and Corporate Social Responsibility Report

Transcription

1 Corporate Governance and Corporate Social Responsibility Report

2 Our mission Bci defines itself as a Financial Solutions Corporation that participates in all financial activities and operations permitted by the General Banking Law, offering the community products and services with highly-efficient operating processes and excellence in quality, with constant technological innovation, prudent risk-management policies and demanding ethical standards that have to be respected by everyone working in its companies. In this scenario and in order to meet its objectives and policies, the Corporation commits to ensure that these are met, with special emphasis on what it considers to be its four fundamental pillars: The Shareholders Business policies and decisions should always be designed to increase the capital that the shareholders have invested in the company, striving to ensure that the return on their investment is higher than the average for the banking sector, accompanied by normal levels of risk for the Corporation s businesses and with a maximum possible level of transparency in its conduct in line with the prevailing law, regulations and ethical framework. Customers and Suppliers The products and services that the Bci companies offer their customers should be of optimum quality, at competitive prices, innovative and to meet their needs properly and promptly. It should always be remembered that the customers are the basis of the Institution s success and commercial relations with them should therefore be maintained with a long-term perspective. Mutually beneficial relations should be maintained with suppliers accompanied by loyalty over time and high standards of quality, compliance and transparency. Staff and their Families The Corporation should endeavor to ensure that all its staff have a dignified standard of living, stable work and possibilities for personal, professional and family development, properly motivating and rewarding good performance and individual and team effort, while providing the guidelines and regulations for maintaining a working atmosphere of excellence and demanding professional and ethical behavior. The Corporation is defined as a family-responsible company in terms of its commitment to strive to ensure that staff work is carried out in conditions compatible with a proper personal and family life. Society The commitment of the Corporation is to develop its businesses and activities within the framework of governing laws in the country and abroad, wherever it does business. It will abide in full by the ethical principles that ensure respect for the rights and interests of others, according to the guidelines established and accepted by society. As an enterprise, it is also interested in contributing effectively to maintaining a healthy environment and enhancing the social, cultural and economic heritage of the nation by supporting relevant initiatives. The Corporation is fully aware of social responsibility that it has as a company.

3 Report on Corporate Governance and CSR We aspire to be leaders in innovation, proximity and customer satisfaction and be recognized as the best company for selfdevelopment and to work for

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5 00. Contents Report on Corporate Governance and CSR Letter from the Chairman Scope of the report Tagets 2007 & commitments Profile Corporate Social Responsibility in Bci Corporate governance & ethics Quality of working life Customers & suppliers Commitment with the community The environment Economic performance Global Reporting Initiative Index & Global Compact 100

6 01. Letter from the Chairman

7 Report on Corporate Governance and CSR This report, which we are pleased to share with our stakeholders for the fourth year, is another step in the culture of permanent innovation with which Bci seeks to characterize itself in the area of Corporate Social Responsibility (CSR). Through it, we wish to show the way in which we relate to all our stakeholders: shareholders, staff and their families, customers, suppliers and communities. This desire explains the new structure of the document that you have in your hands and which includes the six areas of action of our CSR strategy: corporate governance, ethics, quality of working life, commitment with the community, customers and suppliers and the environment. In each of these areas of action, Bci tries to put into practice the principles that are a characteristic of its form of operating and on which our 70 years of solid corporate reputation is based. Those are the pillars contained in our framework of values that defines the limits and areas in which our institution wishes to operate and permits providing a clear north for the whole Corporation in relation to the form of action that we should always respect as a company. During 2007, we have perfected our internal corporate governance policies, creating new directors committees to enable their members to be better informed about the daily progress of the Company s business. We have also established a new policy for suppliers that seeks to institutionalize our relations of respect and mutual collaboration with this important stakeholder and which has been complemented with a continual process of measuring their levels of satisfaction. As has been a constant in recent years, we have increased the benefits of the social network enjoyed by our staff, like the cases of the programs I want you protected and Gradual return following post-natal leave, that seek to provide a dignified quality of life to the Company s employees and their families. In the same way, we have continued our programs directed to small and medium enterprises in Chile, always counting on the voluntary support of our staff, as Bci is proud to be able to say that we have a common spirit that enables us to carry out our corporate social responsibilities at all levels of the Corporation also saw the start of our alliance with Fundación Las Rosas. This commitment seeks to project the Corporation s help and, very especially, that of its staff. Concrete initiatives and programs of mutual benefit have therefore been established, whose beginning has been highly successful. As we also wish to contribute to maintaining a healthy environment, we have begun an environmental care program that promotes in our staff the efficient use of electricity, water and paper in Bci s offices. We in Bci want to continue being a company in which the internal culture permits and motivates everyone to comply with the values framework and the mission that we have set out. We have therefore tried to create incentives so that every member of the staff can be part of this aspiration. We can say with satisfaction that those who contribute in their daily work to the success of this Corporation are clear about the principles that it wishes to preserve and know the means by which the Bank provides to put these into practice. Cordially, Luis Enrique Yarur Rey Chairman

8 Scope of the report This fourth Report on Corporate Governance and Corporate Social Responsibility, which Bci publishes annually, covers its social, environmental and economic performance in the year 2007 by all its businesses, except where stated otherwise. In its preparation, we have taken into account the indicators contained in the guide of the Global Reporting Initiative (GRI), version G3, published in October 2006, for the preparation of annual sustainability reports. We have also considered for the first time the indicators of the Financial Services Sector - Social Performance supplement (November 2002). The report is also intended to provide a suitable account of compliance with the principles of the United Nations Global Compact. Information on previous years is included in the cases in which it is expressly reported and where it is relevant. In order to meet the principles referring to the definition of the contents, as in the principles of relevance / materiality and the sustainability context of the GRI standard indicate, the performance indicators were selected based on an internal exercise at inter-managerial level which revised and chose the most important aspects. In the preparation of this report, we had the support of an external consultant specialized in GRI guidelines who was responsible for ensuring the quality, comparison and checking of the information. It was also possible to document the targets for the following year through this work. The technical data and calculations made for preparing each quantitative indicator of economic, social and environmental performance are based on procedures recognized by national regulations and correspond to standards accepted by the international community. This year, most of the graphs and tables include information on Banco Nova, in contrast to When this information is excluded, this is made explicit, as also in the case of information on Proservice. 1

9 Report on Corporate Governance and CSR Bci completed seventy years of existence, consolidating a valuable record of progress and innovations for its customers. The financial information of the Bci Corporation is expressed in Chilean pesos, except where indicated to the contrary, and is covered more extensively in the Annual Report distributed by Bci, which has been provided for four years now together with this report. This information is audited by PricewaterhouseCoopers. This year we have printed 4,000 copies of this report in Spanish and 500 in English, which will be sent to our principal stakeholders. In order to ensure access to the information, this and the reports for previous years can be found on the Company s web site (

10 03. Targets 2007 and commitments 2008 Area Target 2007 Performance Target 2008 Corporate Governance Manage the Bank s business based on continuous improvement, transparency & involvement in the management Met 100%. Creation of Directors Finance & Corporate Risk Committee. Continue advancing in management transparency & involvement. Creation of Directors Compensations Committee. Corporate Ethics Develop campaign directed to all staff setting out the ethical contents. Met 100%: ethics campaign What do I do?. Carry out internal campaign for maintaining ethical contents. Make study of ethical values to establish to what degree Bci has incorporated ethical principles in its management. Met 100%: Fundación Generación Empresarial jointly with Gemenis Consultores made a study of ethical values in the industry. Quality of Working Life Keep Bci among the best companies to work for in Chile. Develop & carry out internal survey of staff benefits. Gather, coordinate & articulate programs & benefits for staff & their families. Bci was placed 21st out of 35 companies in the Great Place to Work ranking. Met 100%. Met 100%: implementation of the Bci with you benefits program. Be among the best companies to work for in Chile. Generate & extend cover of new agreements to the regions. Implement 100% of the internal communications plan for positioning the Bci with you benefits program. Be the company with the best accident frequency rate in the banking industry. Met 100%: Bci obtained first place among the banks, with the lowest occupational accident frequency indicator. Remain among the best three companies in terms of the lowest occupational accident frequency indicator. Achieve an accident rate of below 1.25%. (No. of accidents/ average number of employees in year). Customers Advance in transparency with customers. Improve quality of service indicators. Met 100%: publication of the manual Our commitments to you, Bci at the service of its customers. Creation & redefinition of monitoring mechanisms of the level of customer satisfaction. 45% of customers surveyed in the year gave a mark of 7 (out of 7) for the service provided by Bci. Lead in quality of service in preferred businesses. Take advantage of extension of banking to provide access to micro-businesses. Innovate in new products & services that make life easier for our customers. Innovate in new products & services that make life easier for our customers. Met 100%. Launch of eight new products & services that make life easier for our customers.

11 Report on Corporate Governance and CSR Area Target 2007 Performance Target 2008 Suppliers Prepare & approve the Corporate Procurement & Suppliers Policy. Evaluation criteria. Introduce a web page for suppliers. Develop & implement a Quality of Services to Suppliers survey. Met 100%. Met 100%. Met 100%. Incorporate CSR criteria in the evaluation & choice of suppliers. Introduce the Listen to Suppliers program. Implement an improvement plan, according to the weakest points raised in the Quality of Service to Suppliers survey & evaluate them in the next opinion survey. Community Launch alliance with Fundación Las Rosas. Met 100%. Consolidate the alliance with Fundación Las Rosas. Implement a program of guided visits to the Art Collection of Chilean Artists. Define a support project for the care & conservation of the environment in Chile. Met 100%. Met 100%: a conservation & environmental education project was developed in the Pan de Azúcar National Park. Implement corporate volunteers program. Implement the conservation & improvement project in Pan de Azúcar National Park. The Environment Reduce consumption of water, energy and paper by 10% in every office of Bci. Paper consumption was reduced by13%. Energy & water consumption did not reach the target reduction of 10% in all offices, but the branches in the Antofagasta Region beat the target & managed a reduction of 18%. Maintain the Wake up program for the continued reduction in consumption of water, electricity & paper, & the recycling of paper in offices in Chile. Prepare & introduce a policy of electronic recycling. Increase by 10% the weight of recycled paper in the Metropolitan Region. Carry out an internal campaign creating awareness of care for the environment. Met 100%. Met 100%: implementation of the environmental care campaign Wake up, the environment is in your hands. Extend the environmental care campaign Wake up, the environment is in your hands to Bci customers. Begin a feasibility study for adhering to the principles of Ecuador 2. Introduce a program for recycling plastics & edible oil waste of the canteen suppliers in the Metropolitan Region. Met 100%: program for recycling plastics & edible oil waste of the canteen suppliers in the Metropolitan Region was implemented. 2 The principles in Ecuador are a series of guidelines prepared and assumed voluntarily by the banks for managing social and envitonmental matters related to the financing of development projets. (

12 04. Profile Our company Banco de Crédito e Inversiones opened its doors to the public on June 10, 1937, after being authorized by Ministry of Finance Decree 1683 of May 7, It was constituted as a banking corporation and its principal objective was to attend the country s productive sector, focusing mainly on small businesses and family work. 70 years later, its management and innovative capacity have kept it as one of the country s most important financial entities, becoming the third largest private-sector bank in Chile, with consolidated assets of Ch$10,679,305 million as of December 31, The Bci Corporation currently employs 9,541 people, of which 6,251 work in the Bank and 3,290 in its subsidiary companies. In 2007, Bci served around 1,200,000 customers and responded to the interests of an average of 2,300 shareholders. The Company has a network of 273 banking services offices in the country, from Arica in the north to Villa Las Estrellas in the Antarctic. Abroad, it operates a branch in Miami, representative offices in Mexico City, Lima, Sao Paulo and Hong Kong and a business agent in Madrid in a strategic alliance with Banco Popular Español. Specific business units: Corporate, Companies & Real Estate Banking Retail Banking Businesses Banking Mass Banking Finance & International Internet Banking Bci Inversiones Leasing Subsidiary companies: Bci Asesoría Financiera S.A. Bci Corredor de Bolsa S.A. Bci Corredores de Seguros S.A. Bci Administradora de Fondos Mutuos S.A. Bci Factoring S.A. Bci Securitizadora S.A. Compañía de Normalización de Créditos, Normaliza S.A. Análisis y Servicios S.A. Bci Administradora General de Fondos S.A. Bci offers its customers a wide range of credit, savings and investment services, providing them with all kinds of financial products oriented to individuals, business people, small and medium enterprises, and large corporations and institutions. The Bank s customers have access to products through both the commercial line and branch network, and the web site ( telephonic platform and other remote channels.

13 Report on Corporate Governance and CSR Memberships and voluntary agreements Bci forms part of the following entities: Asociación de Bancos e Instituciones Financieras (ABIF) Asociación de Exportadores de Manufactura y Servicios (Asexma) Asociación de Exportadores de Chile (Asoex) Cámara de Comercio de Santiago Cámara Chilena de la Construcción Cámara Chileno-Norteamericana de Comercio (Amcham) Cámara Oficial Española de Comercio de Chile Cámara Chileno Alemana de Comercio Cámara de Comercio Chileno Argentina Cámara de Comercio Chileno Brasileña de Santiago Cámara de Comercio Chileno China Cámara de Comercio Chileno Francesa Cámara de Comercio Chileno Mexicana Cámara de Comercio Chileno Peruana Instituto Chileno de Administración Racional de Empresas (Icare) Confederación Internacional de Bancos Populares Acción RSE Fundación ProHumana THE COMPANY HAS A NETWORK OF 273 BANKING SERVICES OFFICES IN CHILE Fundación Generación Empresarial Global Compact in Chile (United Nations)

14 04. Profile Prizes and recognitions During 2007, Bci received prizes and distinctions not only for its performance but for its reputation and commitment shown toward its staff, the community and the environment. Company of the year prize, Chile US Chamber of Commerce (Miami). This prize identifies and recognizes those organizations that stand out for their leadership in the industry, and for their vision and social responsibility toward the Chilean business community resident in Miami, United States. Ranking of the most profitable and best governed banks in Latin America, Management & Excellence (M&E) and Latin Finance magazine. Bci obtained third place. Ranking of the most admired companies, Diario Financiero and PricewaterhouseCoopers. Bci was placed sixth, maintaining its position among the top ten places during the nine years that this survey has been carried out. Ranking of the best companies to work for in Chile, Great Place to Work Institute and Capital magazine. Bci was placed 21st among the 35 best companies to work for in Chile. Ranking of the most socially-responsible companies, Fundación ProHumana and Capital magazine. Bci achieved 8th place among companies noted for their performance in this area. Competition of institutional annual reports, Editorial Gestión and PricewaterhouseCoopers. For the third consecutive year, the annual report, together with its report on corporate governance and CSR, were awarded top place in this competition.

15 Report on Corporate Governance and CSR Prize for the best banks in Latin America, América Economía magazine. Bci was placed 14th among the best banks in Latin America. Chilean ranking of consumer satisfaction, ProCalidad, Universidad Adolfo Ibáñez, Adimark, Praxis and Capital magazine. Bci received an honorable mention in the category Companies with Memberships. National prize for energy efficiency, Confederación de la Producción y del Comercio (CPC), Ministry of the Economy and Diario Financiero. Bci received the prize in the Large Company category for the implementation of energy efficiency plans in its management and advertising campaigns. Annual safety prize of the Consejo Nacional de Seguridad. Bci won first place in the banking company category. Bci has received this distinction for 12 years. Heritage prize in the company category, Corporación Patrimonio Cultural de Chile. Bci received this distinction for its constant support for cultural-value projects of heritage importance. Garrigues-Affinitas prize for good corporate governance in Latin America, awarded at the 9th Latibex Forum in Spain. Bci was among the finalists of the 2nd edition of the Garrigues-Affinitas prizes for good corporate governance in Latin America. Global Pulse ranking, Reputation Institute and Pontificia Universidad Católica de Chile Placed 28th from among 100 companies, achieving recognitions among Chilean companies in four of the seven dimensions, with first prize in innovation and working environment. Ranking of companies with the best corporate reputation, Hill & Knowlton Captiva, La Tercera and Collect. Bci was places 21st out of 25 companies evaluated. Silver Big! in the financial services category, CONEP Marketing S.A. and Marketing Directo and Nacional de Avisadores associations. Bci obtained the Big! prize in recognition of the best direct and relational marketing campaigns.

16 04. Profile Dialogue and commitments with our stakeholders Bci s corporal social responsibility (CSR) strategy, as well as its mission, has as its basic pillars the principal stakeholders with whom it relates: shareholders, staff and their families, customers, suppliers and society. The Bank gives priority to the generation of trust and transparency in all its relations and has therefore developed and introduced different levels of communication, consultation, dialogue and participation. The following table identifies the principal stakeholders, the different mechanisms of dialogue, and the expectations and interests detected by these mechanisms and examples of the way in which Bci responds to them. Stakeholder Mechanism of dialogue/involvement Interests and expectations Response Shareholders (majority & minority) Web site ( Bci provides its shareholders & the public with information on financial performance, liquidity & market risk. Investor Attention Office, under the Planning & Performance Control Management. Create sustainable value. Report promptly, transparently & reliably. Publication & distribution of the Annual Report. Publication & distribution of the Report on Corporate Governance & Corporate Social Responsibility. Telephonic conferences with analysts & investors. Personal meetings with institutional shareholders & the principal market investors. Electronic mail: investor_relations_bci@bci.cl, where analyst & investor enquiries are received. Staff Programs for improving the organizational climate & quality of working life, like the Listen to Staff & Bci is Listening to You programs. Surveys & dialogue to know perceptions, like face-to-face meetings, the service quality survey (internal), benefits and working environment survey. Also hold meetings with the unions. Development of internal means for reporting on the Bank s progress, like corporate , intranet, internal magazine, corporate channel & news-boards. Work in a company with a pleasant & respectful working atmosphere. Balance work with family life. Know the company s strategy. Awarded 8th place in ranking of socially responsible companies (ProHumana). Be among the 25 best companies to work for in Chile. Maintenance of the lowest occupational accident frequency rates in the banking industry. Studies to establish the company s internal reality like the ProHumana & Great Place to Work rankings.

17 Report on Corporate Governance and CSR The Bank gives priority to the generation of trust and transparency in all its relations and has therefore developed and introduced different levels of communication, consultation, dialogue and participation. Stakeholder Mechanism of dialogue/involvement Interests & expectations Response Customers Use of various tools for knowing the perception of customers with respect to the service of Bci: Listen to Customers program, Complaints Attention system & Customer Satisfaction Survey. Improve the quality of service. Give guarantee of transparency, security & confidence. Creation & redefinition of monitoring mechanisms at customer satisfaction level. Publication of manual Our commitments to you, Bci at the service of its customers. Suppliers Development of mechanisms for knowing the perceptions of suppliers: survey of suppliers, web portal for suppliers and use of the suggestions & complaints channel. Reduce payment times. Provide information on tendering processes. Maintain fluid communication channels. Generate transparent & long-term business. Creation of Corporate Procurement & Suppliers Management. Speed up process of suppliers payments. Creation of site on page for suppliers that includes an on-line consultation channel. Formalization & standardization of suppliers evaluation criteria. Community Measurement of Bank s activities & the way in which they are perceived through the Corporate Reputation Study (evaluation of CSR performance) and Most Admired Companies survey. Support for social development. Development of alliance with Fundación Las Rosas. Maintenance of the Corporación de Crédito al Menor and Nocedal Orchestra, which benefits children at social risk. Support the development of SMEs (Nace & Renace programs).

18 Corporate Social Responsibility (CSR) Over and above the way in which the Bank manages its businesses, Bci has the ethical need to positively impact the community with concrete benefits that ratify the values with which the company and its shareholders are developing.

19 common good... Over 70 years concerned for the people. Report on Corporate Governance and CSR

20 05. Corporate Social Responsibility in Bci PEOPLE ARE THE CORE OF THE BANK S BUSINESS Principles Throughout its history, the focus of Bci s business has been the Value Framework which its shareholders have established in its Mission. Its efforts therefore have been centered on maximizing the value that the Bank generates both for its shareholders and customers, but also for its staff and society. These are the principles that motivate Bci to not only seek to manage its businesses in accordance with the prevailing law, but to make constant efforts to best satisfy all those who receive the effects of its actions. The Bank is convinced that there is an ethical imperative that has to be met.

21 Report on Corporate Governance and CSR Value Framework The policies and actions that Bci develops take into account that the person is the final objective and the center of all human activity. In this way, the Bci Corporation, apart from trying to maintain returns on capital and assets above the financial system average through operating efficiency, services of excellence and strong technological innovation, has as its principal aim to promote the economic, professional, moral and spiritual welfare of everyone affected by its activity, especially its shareholders, customers and staff. In the consideration of the Value Framework, Bci takes into account the universal recognition that the Common Good should take priority over the Individual Good of its members. People All members of Bci have to always remember everyone s right to preserve their dignity, which translates into the acknowledgement of: Their freedom and expression in legitimate autonomy in the work field so that everyone has the opportunity to develop their initiative within their own environment. Their work facilitates personal realization, and also of those under their influence. Their right not to be pressured to do what their conscience tells them is illicit. The duty to work in accordance with natural moral order requirements on which all value frameworks are based. Their work is carried out honestly, refraining from acting in variance with the ethical standards and laws to the benefit of Bci, themselves or customers. Their right to be treated always with respect, which implies the corresponding duty to care for the reputation and good name of others. Support for the stability and constitution of the families of their staff and their dedication to them. The Corporation Those working for Bci have to acknowledge their commitment with the organization, which requires of them to: Cooperate decidedly in achieving Bci s targets and objectives, providing with initiative the due collaboration with customers, subordinates, superiors and working colleagues. Work with intensity, constancy and dedication, bringing their capacity and initiative together with personal responsibility. Contribute effectively to the existence of a climate of trust, respect and harmony that facilitates team work. Assume as their own the indications of the authorities in the legitimate exercise of their powers. Be extremely prudent in questions of economic and business ethics, seeking advice if necessary in order to act always in an exemplary way. Provide information as required as quickly and accurately as possible so that everyone can take their decisions with the proper information, safeguarding the confidentiality of customer information in accordance with the legal framework in which the Corporation operates. This duty is especially relevant to those in supervisory positions. Maintain excellent personal and commercial relations with Bci customers, providing the best service honestly and transparently, and always caring for the legitimate interests of the Corporation. Be examples both in commercial activities and their social and private ones, as the prestige of the Corporation is in those working for it.

22 05. CSR in Bci Strategy The CSR strategy of Bci is based on its Value Framework which directs the definition of the different policies, actions and objectives related to staff, customers and suppliers, shareholders and society. It also states that people are the final object and center of all the activities. In accordance with this action framework, CSR for Bci is based on two principal ideas: The company should ensure that all its actions and their effects lead to the achievement of progress, not only for its own shareholders but also for the community. CSR should be integrated imperatively in the management of the company as the welfare of the community in which it operates influences it significantly. The commitment of Bci with this CSR strategy is evidenced by the incorporation of its targets and indicators in its balanced scorecard (BSC) /2009. To ensure compliance with the CSR objectives set in the BSC, an inter-managerial work team was formed called the CSR Continuous Improvement Team. Corporate Social Responsibility Process. 7. Evaluation and improvement of the process 6. Follow-up and results 1. Formation of multi-disciplinary team 5. Presentation to the Corporate Governance & CSR Committee 2. Definition of CSR process strategy 3. Definition of targets according to BSC 4. Plans according to BSC 3 Balanced Scorecard (BSC): management model that helps Bci to translate the strategy into tactical objectives and which has been used since It is a program for the management of change and not simply a program for measuring what has been done.

23 Bci s efforts, both in its value framework and in its CSR strategy, are focused in the maximization of the value that the Bank generates for both its shareholders and customers, but also for its staff and society. Report on Corporate Governance and CSR Areas of action Bci has defined six areas of action to develop its management model, each of which is intimately related with its principal stakeholders: Corporative governance Ethics The environment Quality of working life Customers and suppliers Commitment with the community The detail of Bci s performance in each of these areas of action on which CSR management is structured is shown below.

24 Corporative governance & ethics The Bank is concerned every day to improve the internal corporate governance policies and of innovation in the creation of new campaigns and committees that transmit the Bci spirit to its staff.

25 new innovations... Come and reinforce the Ethics Code Report on Corporate Governance and CSR

26 06. Corporative governance & ethics Board of Directors The Company s board is comprised of nine members who were elected at the ordinary shareholders meeting held on April 24, 2007, in accordance with the law and the bylaws. These remain in their positions for three years, and may be re-elected. The board has elected from among its members Luis Enrique Yarur Rey as chairman and Jorge Cauas Lama as vice chairman. The board s mission is to maximize the value of the Company over the long term, caring for the interests of the shareholders, customers, suppliers, staff and their families and society, ensuring the Company s future viability and competitiveness, with respect for current legislation and the ethical duties contained in Bci s code of ethics. The board s actions are governed by the following principles and documents: Bci s ethics code which contains the principles that inspire the form of conduct of the businesses by members of the company, covering aspects of commercial behavior and relations with shareholders, customers, suppliers, staff, their families and the public in general. It also refers to eventual conflicts of interest between the personal conduct of those working in the organization and their positions in Bci. To ensure that all acts are carried out in the most transparent way possible, so that there is no doubt that these have been done in strict accordance with its mission. The board should also ensure that this principle covers all acts of the Bank s management. Members of the board should perform their work having complete information available, in good faith, with due diligence and always caring and safeguarding the best interests of the company and all its shareholders. Bci has therefore established processes for permitting a complete and transparent flow of information from and to the board. When board decisions may affect different groups of shareholders in different ways, such decisions should be taken to ensure a fair treatment for each one of them. It should therefore ensure the freedom of opinion of all members of the board and encourage constructive criticism concerning the way in which the Bank is managed.

27 The board s mission is to maximize the value of the company over the long term, caring for the interests of the shareholders, customers, suppliers, staff and their families and society, through the respect of current legislation and the ethical duties contained in Bci s code of ethics. Report on Corporate Governance and CSR Board members Position Since Luis Enrique Yarur Rey Chairman October 21, 1991 Jorge Cauas Lama Vice Chairman March 19, 1992 Andrés Bianchi Larre Director April 24, 2007 Juan Manuel Casanueva Préndez Director April 24, 2007* Pedro Corona Bozzo Director March 24, 1998** Sergio De Amesti Heusser Director March 24, 1977 Alberto López-Hermida Hermida Director April 17, 2001 Dionisio Romero Seminario Director February 27, 1996 Daniel Yarur Elsaca Director April 17, 2001 * Juan Manuel Casanueva Préndez was previously a director of Bci during the period ** Pedro Corona Bozzo was previously a director of Bci during the periods and

28 06. Corporative governance & ethics Profile In order that directors make a concrete contribution to the governance of the Bank, these are elected based on their intellectual, professional and values qualities. They are also people who have performed outstandingly in their respective fields of action. The directors therefore have formation and tendencies that do not always coincide, so that the quality of the decisions taken is guaranteed by the variety of positions. The board members include representatives of different branches of economic activity, an ex minister of state, an ex president of the Central Bank of Chile and an ex superintendent of securities and insurance, having performed in these positions in different political administrations. While there are no formal requirements for joining the board, over and above those established by law, the board has traditionally comprised professionals and business people unrelated either under a controlling agreement or to the Yarur family, with the sole exception of its chairman. At the close of 2007, the direct shareholdings in the company of the members of the board amounted to 1.4 % of its share capital. Luis Enrique Yarur Rey Chairman Master in Economics and Business Management from the Instituto de Educación Superior de Empresas (IESE), Spain, and Lawyer from the Universidad de Navarra, Spain. He is currently Chairman of Empresas Juan Yarur S.A.C., Vice Chairman of the Chilean Banking Association, Director of the Santiago Stock Exchange, Member of the International Advisory Board of IESE, Spain, Member of the Business Advisory Council of the Center for Superior Studies of the Universidad de Los Andes (ESE); Director of Bci Seguros de Vida S.A. and Bci Seguros Generales S.A., Chairman of Empresas Jordan S.A., Chairman of Salcobrand S.A., Vice Chairman of Empresas Lourdes S.A. and Director of Banco de Crédito del Perú, among other boards. Prior to his present position, he was Chief Executive Officer of Bci for 11 years.

29 Report on Corporate Governance and CSR Jorge Cauas Lama Vice Chairman Master of arts in Economics, Columbia University, United States and Civil Engineer from Universidad de Chile. Number Member of the Academy of Social, Political and Moral Sciences of the Instituto de Chile. Vice Chairman of Empresas Juan Yarur S.A.C., Chairman of Bci Seguros Vida; Chairman of Bci Seguros Generales and Member of the Business Advisory Council of the Center for Superior Studies of the Universidad de Los Andes (ESE). He has been a Professor at Universidad de Chile and Pontificia Universidad Católica de Chile, Vice President of the Central Bank of Chile, Director of the Center of Studies for Development of the World Bank, Minister of Finance and Chilean Ambassador to the United States. Andrés Bianchi Larre Director Degree in Legal and Social Sciences from Universidad de Chile and Master of Arts in Economics from the University of Yale. He is currently President of the Financial Advisory Committee of the Ministry of Finance and is a Director of Empresas Copec S.A., the Cámara Chileno Norteamericana de Comercio and the Fulbright Commission. He has been Chilean Ambassador to the United States, President of the Central Bank of Chile, of Dresdner Banque Nationale de Paris and Banco Credit Lyonnais Chile; and joint Executive Secretary of the Economic Commission for Latin America. He has been Professor in Economics at Universidad de Chile and Pontificia Universidad Católica de Chile, Visiting Professor to the University of Boston and Visiting Researcher of the University of Princeton. Juan Manuel Casanueva Préndez Director Civil Engineer from Universidad de Chile. He is Chairman of Grupo Gtd and a Director of Fundación Rodelillo and Corporación del Patrimonio Cultural. He is also a Member of the Advisory Council of the Center for Superior Studies of the Universidad de Los Andes (ESE) and of the Business Council of the Center of Enterprise of Universidad del Desarrollo.

30 06. Corporative governance & ethics Pedro Corona Bozzo Director Accountant Auditor, Degree in Economics and Management Sciences, Universidad de Chile. He is Chairman of Administradora de Fondos de Pensiones Cuprum and the Cámara Nacional de Comercio, and a Director of Depósito Central de Valores. He has been President of the International Federation of Pension Fund Managers, President of the Chilean Pension Funds Association, Chairman of Fábrica de Cementos el Melón S.A. and Vice President, Administration and Finance, of Codelco Chile. Sergio de Amesti Heusser Director Lawyer from Universidad de Chile. A Director of Empresas Juan Yarur S.A.C., Director of Fundación Andes and Member of the Chilean Institute of Lawyers. A founding partner in the Law Firm De Amesti, Bezanilla, Torres y Cía. Ltda. and has been a Director of various companies. Alberto López-Hermida Hermida Director Public Accountant from Universidad de Buenos Aires and Accountant Auditor from Universidad de Chile. Was a partner in the firm PricewaterhouseCoopers in which he occupied several management positions in Argentina, England and Chile, becoming the senior partner of the firm in Chile. He is currently the Director General of the Center for Superior Studies of the Universidad de Los Andes (ESE).

31 Report on Corporate Governance and CSR Dionisio Romero Seminario Director Master in business Administration from University of Stanford, Business Administration (BA) in Economics from Pomona College, California, both in the United States. Currently Chairman of Corporación Credicorp; Peru; Chairman of Banco de Crédito del Perú, of the Peruvian Bankers Association and Chairman of Banco de Crédito de Bolivia. Daniel Yarur Elsaca Director Graduated in Advanced Management Program of Harvard Business School, United States, Master of Science in Finance, London School of Economics, United Kingdom and Engineer in Information and Management Control and Accountant Auditor from Universidad de Chile. Director of Invertec Pesquera Mar de Chiloé S.A., of Sociedad Química y Minera S.A. and of Antofagasta Minerals Plc. He has been President of the Council of Securities Regulators of the Americas (Corsa); Superintendent of Securities and Insurance and Professor in the Economics Faculty of Universidad de Chile. Lionel Olavarría Leyton Chief Executive Officer Master in Economics and Business Management from the Instituto de Educación Superior de Empresas (IESE), Spain and Civil Industrial Engineer from Universidad de Chile. He is currently a Director of Bci Seguros Generales, Bci Seguros de Vida, Bci Corredor de Bolsa, Empresas Juan Yarur S.A.C. and Salcobrand S.A. and is Chairman of Bci Factoring. He previously worked as a Consultant Engineer in Chile and Spain, occupying the positions of Controller of Chemical Bank, Spain, and Commercial Manager of Banco Santiago. He was the founding Chairman of Redbanc S.A., Chairman of Transbank S.A. and Edibank S.A., Chairman of Servipag S.A., Director of Parque del Sendero S.A., Chairman of Artikos Chile S.A, Banco Conosur and Director of Financiera Solución (Peru). He has 32 years experience in banking and 26 years with Bci, being its Chief Executive Officer since 1993.

32 06. Corporative governance & ethics Functioning The board meets monthly to analyze and resolve on the principal matters of its competence of the various activities of the Bank, and meets extraordinarily if the management of the business so requires. As established by law, board meetings are constituted with the absolute majority of its members and resolutions are adopted by the absolute majority of the directors present at the meeting, there being no matters for which a larger quorum is required for their approval. The chief executive officer is the secretary of the board, at both ordinary and extraordinary meetings, assisted by the Bank s legal counsel. Bci has set internal policies for ensuring that each director has in good time all the information required for the correct taking of decisions. All the reports and presentations that serve as a basis for the matters for discussion at each meeting, and which are not of a strictly-confidential nature, are therefore handed to each director in advance. Among the reports examined, the board receives a monthly presentation on the performance of the management of Bci and the results for the present year. It also analyzes and pronounces annually on the results of the management evaluation process completed by all levels of the organization, of the Bank and its subsidiary companies, according to a procedure that takes into account a separated composition of activities of the different risk areas. As in every year, and in order to deal with specific matters that require a reasoning and deeper understanding appropriate to good corporate governance, the board met on December 18, 2007 for a full day to revise matters like the determination of Bci s global strategy and planning, and the budget for the following year, the definition of priority plans for the coming year, the revision of the results for 2007, and the degree of compliance with the agreed action plans. Attendance at board meetings Director Luis Enrique Yarur Rey (Chairman) Jorge Cauas Lama (Vice Chairman) Andrés Bianchi Larre* - 9 Juan Manuel Casanueva Préndez* - 8 Pedro Corona Bozzo Sergio De Amesti Heusser Alberto López-Hermida Hermida 12 9 Dionisio Romero Seminario 9 10 Daniel Yarur Elsaca 10 9 * Andrés Bianchi Larre and Juan Manuel Casanueva Préndez were appointed as directors on April 24, 2007.

33 Report on Corporate Governance and CSR Functions Apart from the powers of judicial and extra-judicial representation to comply with the corporate objects that the law grants to the board, this specifically carries out the following key and distinctive functions: The definition of the Bank s mission. The approval, revision and supervision of the corporate strategy, the principal action plans, the annual budgets and supervision of the principal expenses, investments, acquisitions and disposals of assets. The revision and approval of the monthly and annual financial statements. The evaluation and supervision of portfolio diversification and credit-risk, operational and technological policies, and the performance of the subsidiary companies. The supervision and arbitration of possible conflicts of interest between the management, directors and shareholders, including the fraudulent use of corporate assets and the abuse of transactions between stakeholders. Examination of compliance with the obligation of integrity of the Company s accounting systems and financial statements, including the making of an independent audit and the implementation of proper control systems. Supervision of compliance with the Bank s transparency and corporative governance policies. Supervision of the communication process and information policy. Examination and response to presentations addressed to the Superintendency of Banks and Financial Institutions by customers and the public.

34 06. Corporative governance & ethics Special powers conferred by the board on its chairman The chairman of the board has special powers to act with the necessary flexibility for the executive and agile exercise of his responsibilities. Apart from the particular powers of the chairman by law or the bylaws, this power includes the following: Supervise the planning and annual budget processes and be kept informed of and supervise the corporate operations and business. Approve the Bank s general organization. Appoint and remove when deemed convenient one or more managers, assistant managers and other executives, with the exception of the chief executive officer, who may only be appointed or removed by the board. This power extends to the setting of his remuneration. Determine the powers of the different committees and executives for granting credit or for taking positions in financial instruments in Chile or abroad, with reference to the amounts, characteristics, conditions and other matters, adopt the mismatch of positions, accept maximum losses and carry out trading operations. Partially delegate the powers granted to him to one of more managers. In the absence of the chairman, these powers shall be exercised by the Vice Chairman. Committees The board seeks to adapt its functions to limit its actions in the determination and supervision of the corporate policies, without interfering in their management, so that the management and the board meet their objectives in the best possible way. The board has therefore delegated some of its powers to committees especially formed for this purpose.

35 Report on Corporate Governance and CSR Executive Committee The Executive Committee meets twice a week with full powers granted by the board to resolve on different matters, principally of a credit and business nature. This committee is made up of five board members, being Luis Enrique Yarur Rey (Chairman), Jorge Cauas Lama (Vice Chairman), Pedro Corona Bozzo, Sergio De Amesti Heusser and Alberto López-Hermida Hermida, with Andrés Bianchi Larre, Juan Manuel Casanueva Préndez, Dionisio Romero Seminario and Daniel Yarur Elsaca being alternate members. The Executive Committee has the following powers: Resolve on all the Bank s credit and financial operations submitted for its consideration and resolution. Approve the general policies and manuals of financial, credit and operational risk. Set interest and discount rates for the Bank s transactions and set position limits for loans and financial investments in Chile and abroad, and the maximum permitted losses. Receive reports on the country s different economic sectors and analyse and evaluate their trends, setting credit and financial exposure limits applicable to each of them. Determine the resources to be employed periodically in provisions and write-offs, apart from ensuring compliance with applicable regulations. Resolve the purchase, sale and constitution of collateral on all kinds of movable and immovable assets, securities and rights of any kind, apart from the limitations and prohibitions established in the General Banking Law. Establish branches, agencies and other offices in the country or abroad, and terminate their operations. Grant the general and special powers necessary for the due functioning of the Company. Approve specific donations within the applicable law. Directors attendance at Executive Committee meetings Director Luis Enrique Yarur Rey (Chairman) Jorge Cauas Lama (Vice Chairman) Andrés Bianchi Larre* - 50 Juan Manuel Casanueva Préndez* - 43 Pedro Corona Bozzo Sergio De Amesti Heusser Alberto López-Hermida Hermida * Andrés Bianchi Larre y Juan Manuel Casanueva Préndez asumieron sus cargos el 24 de abril de 2007.