5:12 The starting point for the prudential assessment of group governance is that the firm governed by the law of another Member State that is responsible for the group and its subsidiaries, including the Belgian subsidiary(ies), should be in agreement and operate in a transparent and balanced manner, focusing on optimal management of the activities of the different supervised institutions and adequate monitoring of the risks faced by the individual institutions and the group as a whole.

5:13 In this respect, the institution responsible for the group, as the entity that defines the group’s overall policy and strategy, should ensure that the group is managed in the best possible manner, with respect for the legal personality of the various subsidiaries and without prejudice to any measures the institution responsible for the group may take to control the reputational risk that could arise from inappropriate behaviour by a subsidiary. In accordance with paragraph 77 of EBA/GL/2021/14, the firm governed by the law of another Member State that is responsible for the group should consider the interests of all subsidiaries and how strategies and policies contribute to the interest of each one and of the group as a whole over the long term.