The Central Bank of Cyprus announced that its board members agreed to reaffirm a code of conduct introduced in October 2014, which governs cases of conflict of interest, the independence as well as confidentiality.
The policy is based on understanding, identifying, evaluating, managing, and avoiding conflict of interest, the supervisory authority said in a statement on its website on Monday.
“Members of the board of directors avoid any situation capable of causing a conflict of interest,” the central bank said. “Conflict of interest emerges when members of the board of directors have private or personal interest which are likely to affect or seem to affect the unbiased and objective execution of their duties. The term private or personal interest of members of the board of directors implies any potential benefit for the members and their families and up to fourth-degree relatives by blood or by marriage”.
The decision came more than a year after Central Bank of Cyprus governor Chrystalla Georghadji came under fire over conflict of interest allegations involving the dealings of her estranged husband Andreas Gorghadji’s law firm with Andreas Vgenopoulos, the former Cyprus Popular Bank strongman widely considered responsible for the defunct lender’s failure. The couple’s daughter Marianna Georghadji quit her job at the law firm, which eventually announced ditching Vgenopoulos.
The central bank added that, given the impact on the economy and markets of the board’s decisions, its members should be in position to operate completely independently and unbiased, avoid the use of confidential information to carry out financial transactions, directly or indirectly through third mediators, serving their own interests or those of third parties.
In addition, the members of the board of directors should avoid expressing their views in public which are conflicting with those of the board of directors and should not give the impression that they are representing the central bank, unless tasked to do so by the board, the supervisory authority said.