policies related to the corporate governance manual

alrajhi bank adopts a comprehensive set of governance policies and procedures in line with applicable SAMA and CMA regulations and the Board-approved Delegation of Authority (DoA) matrix. These policies strengthen transparency, disclosure, conflict management, and Board oversight, ensuring effective governance practices across the Bank’s operations.

Risk management policy

Risk Management Policies are built on the principle that effective identification and management of risk are essential to sound Corporate Governance across the Group. The CRO reports to the Board through the Risk Committee and administratively to the CEO, with any removal or resignation requiring Board approval and notification to Saudi Central Bank (SAMA). The bank’s credit risk framework ensures clear segregation of duties and comprehensive policies to mitigate borrower default risk; its market risk approach protects against unforeseen losses by independently assessing risks related to rates of return, equity prices, foreign exchange and commodities; its liquidity risk policy ensures adequate liquid assets and compliance with SAMA directives; and its operational risk policy addresses fraud, employment issues, system failures, business process errors and physical damage, supported by a structured framework for risk governance, identification and integrated reporting.

Whistleblower Policy

To prevent and address acts of bribery, corruption, or other misconduct, the bank has established a comprehensive Whistleblower Policy. Employees across all local and international branches, subsidiaries, and affiliates are encouraged to report any violations, including misconduct, fraud, policy breaches, or attempts to aid and abet wrongdoing.

Multiple reporting channels are provided, including a dedicated hotline and email. The bank ensures the confidentiality and, where requested, the anonymity of whistleblowers. The Whistleblowing and Anti-Bribery & Corruption (ABC) Department is responsible for investigating all reported cases. alrajhi bank maintains a strict zero-tolerance approach to retaliation, and any retaliatory actions are treated as serious disciplinary matters.

Remuneration Policy

This Policy is designed to attract, retain, and motivate talent with the necessary skills, knowledge, and expertise. Employee remuneration considers both current and potential risks and is tailored to the role and responsibilities of each individual. The policy encompasses a mix of financial and non-financial incentives, including cash, equity, and other forms of reward. Control functions and Human Resources are actively involved in designing and implementing remuneration frameworks to ensure alignment with performance objectives while mitigating risks of misconduct.

Insider Information Policy

The Insider Information Policy provides clear guidelines to prevent the misuse of sensitive or confidential information for personal gain. It aims to ensure that employees comply with applicable laws and regulations, promoting ethical conduct and preventing both intentional and unintentional insider trading or misuse of insider knowledge.

Policy for dealing with Politically Exposed Persons (PEPs)

Politically Exposed Persons (PEPs) are considered high-risk customers under Saudi Central Bank (SAMA) regulations and other relevant regulatory frameworks (as outlined in the AML & CTF Manual). In line with regulatory requirements, the bank applies enhanced KYC (Know Your Customer) and EDD (Enhanced Due Diligence) procedures to assess the potential risks associated with PEPs, including their immediate family members and close associates, when establishing a relationship with such customers.

Anti-bribery and corruption policy

The bank enforces a strict zero-tolerance policy toward bribery, corruption, and facilitation payments. Any employee found in violation is subject to disciplinary action, including potential legal consequences. This policy applies to all employees across local and international branches, subsidiaries, and third-party partners. All employees are required to abide by the policy and report suspected breaches through formal reporting channels.

The Whistleblowing and Anti-Bribery and Corruption functions oversee all investigations and have full access to information required for this purpose, including confidential material. Corrective actions are determined based on whether the issue relates to people, processes, or technology. Measures may include disciplinary actions or improvements to controls, in line with Saudi Central Bank (SAMA) whistleblowing regulations. All cases are securely stored with restricted access and are periodically reported to the Board of Directors and the Audit Committee.

Anti-money laundering policy

alrajhi bank complies with international standards for AML, WMD, CTF, and ABC. To manage compliance risks, the bank applies risk assessments, classifying customers by risk level and reviewing products and regions annually. A risk-based CDD process is used, with enhanced due diligence for higher-risk customers. Sanctions screening is conducted against global and local lists, while transactions are monitored through AML systems that flag unusual activity. Suspicious cases are reported to SAFIU.

The bank also follows a three-lines-of-defence risk management model, maintains a certified Business Continuity framework, and applies strict KYC and EDD requirements for politically exposed persons.

The AML Policy undergoes regular scheduled reviews to ensure it remains current. The Compliance and Governance functions oversee updates to reflect regulatory developments, new risks, and internal directives, with final approval provided by the bank’s governance committees.

A formal review process is in place whereby the AML Policy is periodically evaluated by the Compliance and AML teams to ensure it aligns with regulatory expectations, evolving risks, and industry best practices, with any revisions endorsed through the bank’s governance framework.

HR Policy

alrajhi bank is committed to attracting, developing, and retaining talented and engaged employees, recognising their essential role in strong corporate governance and organisational success. The bank’s HR policies provide clear and comprehensive guidance on recruitment, development, performance management, compensation, and employee rights and obligations. These policies ensure a fair, transparent, and well-structured work environment that enhances productivity and strengthens employees’ sense of belonging.

Code of conduct

The bank places strong emphasis on ethical conduct, recognising its critical role in protecting the bank’s reputation and supporting long-term success. A unified Code of Conduct applies across the bank and all its subsidiaries, setting expectations for integrity, professionalism, compliance with laws, regulations, and Shariah principles, and the proper handling of confidential information. All employees are required to review and acknowledge the Code annually, with the Board Governance Committee overseeing the mechanisms to ensure full adherence.

Conflict of interest

This policy defines common conflict scenarios, and the required actions employees must take to avoid compromising the bank’s integrity. A continuously maintained Conflict of Interest Registry, maintained by the Chief Governance and Legal Officer and overseen by the Governance Committee, is reviewed and signed annually by Board members.

Board members are subject to specific requirements:

• They must promptly declare any official or professional positions held during their Board tenure.
• They must ensure no external relationships influence their duties to the bank.
• Any potential conflict related to Board decisions must be immediately disclosed to the Chairman, and the concerned member must refrain from participating in related discussions or voting.
• Board members are prohibited from accepting any direct or indirect advantage linked to their role at the bank.