that should have ensured there were proper risk management and control systems within each bank. it was the board of directors that should have ensured that the senior management of the bank had properly taken into account the possibility of experiencing extreme stress scenarios. finally, it was the board of directors that should have ensured the remuneration structures were in line with the long - run interest of the bank itself rather than rewarding short - term risk - taking. the need for high standards of corporate governance is, therefore, one of the main lessons to be drawn from the global financial crisis. it is in this context that the cbb views the new code as a significant development in strengthening bahrain ’ s reputation as a well regulated financial centre. the new code builds on current international best practice for corporate governance. for example, it reflects the corporate governance principles developed by the organisation for economic cooperation and development which have become the benchmark for international standards in the field. of course, the special responsibilities of the board of directors of a financial institution which i mentioned earlier means that the cbb will need to continue to apply its own corporate governance requirements on such matters as internal high level controls, the avoidance of conflicts of interest, and various public disclosure and reporting requirements. these will need to remain more detailed than those in the new code, for example setting the public disclosure requirements for financial institutions. the cbb ’ s detailed requirements on corporate governance will therefore continue to exist in parallel to the new code. it is important that public companies in bahrain, both financial and non - financial, enter fully into the spirit of the new code. it should not be seen as a matter of complying with just another set of regulations, but as something that should influence the corporate culture of companies in bahrain. greater transparency and more effective governance structures will in the long - run only serve to increase the attractiveness of bahrain for foreign investors seeking to establish or expand operations in the mena region. in conclusion i would like to take this opportunity to thanks dr. hassan fakhro, minister of industry and commerce, for his support and cooperation in the introduction of the new corporate governance code, and to the steering committee for the excellent work it has achieved. thank you for your attention.

rasheed mohammed al maraj : rebuilding confidence in the financial sector introductory remarks by he rasheed mohammed al maraj, governor of the central bank of bahrain, at the chartered institute for securities and investment ( cisi ) event “ rebuilding confidence in the financial sector ”, organized in conjunction with the bahrain institute of banking and finance, manama, 4 october 2011. * * * distinguished guests, ladies and gentlemen : it gives me great pleasure to be here at the first of the continuing professional development events being arranged by the chartered institute for securities and investment in conjunction with the bahrain institute of banking and finance. i am sure that many of you here this evening are already familiar with the cisi ’ s work. for almost 20 years, the cisi has been recognised as the leading professional body for the investment industry in the uk. it now has over 40, 000 members in 89 countries. bahrain is on course to have the largest membership outside the uk, due in part to the success of the bibf ’ s financial advisor programme, which allows successful candidates to become affiliate members of the institute. membership of the chartered institute is recognition that an individual has achieved not only a high standard of technical competence, but also displays the ethical judgement and personal integrity necessary if confidence in the financial system is to be maintained. confidence and integrity are, without a doubt, the foundation of the financial system. all financial firms – whether they are banks, investment managers, insurance companies, or securities brokers – are alike to the extent that they make a promise to the customer. similarly, customers have to believe that the people working in the industry are placing their interests first. if they doubt that the firm or its employees are truly interested in making the customer ’ s money grow, rather than claiming as much of it as possible in the form of fees and bonuses, they will be reluctant to deal with financial firms. these are just two examples of the way in which consumers ’ trust in financial firms can break down. in the last few years we have seen plenty of examples around the world of financial firms that have lost the trust of their customers and have paid a heavy price. the recent allegations that the employees of some large investment banks deliberately created financial products that would fail, imposing large losses on customers so their own firms could benefit, are simply the most high profile of many such allegations that have been unearthed following the financial crisis. regulators have an important role to play in ensuring that customers can trust the financial institutions that they deal with