6:2 Each firm should describe and document its internal governance structure in a governance memorandum. The statutory governing body should approve the governance memorandum and ensure that it is kept up to date.^[1]

6:3 The governance memorandum is a prudential document which forms an integral part of the licence application file and is, as such, confidential.

6:4 The memorandum is primarily the responsibility of the firm. It should be updated whenever significant changes occur that affect the firm’s governance structure and organisation and should be assessed at least once a year by the statutory governing body, in accordance with Articles 19 and 56 of the Brokerage Supervision Act. The firm should provide a detailed explanation if it does not comply with best practices provided for in this manual or in circulars or international guidelines (the “comply or explain” approach).

6:5 An outline for the governance memorandum is annexed to this manual. The use of this outline is optional. It is also good practice to append to the governance memorandum a list of governance policies and internal by-laws in force, if possible along with the relevant documents or links thereto.

^{[1]  Articles 21 §3, 23 and 56 §6 of the Brokerage Supervision Act.}