Swift governance
Table of contents
Swift is a cooperative society under Belgian law and is owned and controlled by its shareholders. Swift shareholders elect a Board composed of 25 Directors which governs the Company and oversees management. The Executive Committee is a group of full-time employees led by the Chief Executive Officer.
Board Director nominations
Swift’s Board composition is designed to reflect usage of Swift messaging services, ensure Swift’s global relevance, support its international reach and uphold its strict neutrality.
Each nation’s usage of Swift’s messaging services determines both Swift shareholding allocations and the number of Board Directors that each nation is entitled to.
Swift shareholdings are determined by a set formula, and the nomination process and the composition of the Board follow rules set out in Swift’s by-laws. Shares are reallocated based on the financial contribution of shareholders for network-based services. This ensures that the composition of the Board reflects Swift’s shareholders around the world. Depending on a nation’s shareholder ranking, it may propose one or two Directors to the Board or join other nations to collectively propose a Director.
- For each of the first six nations ranked by number of shares, the shareholders of each nation may collectively propose two Directors for election. The number of Directors proposed in this way must not exceed 12.
- For each of the ten following nations ranked by number of shares, the shareholders of each nation may collectively propose one Director for election. The number of Directors proposed in this way must not exceed 10.
- The shareholders of those nations which do not qualify under 1. or 2. above may join the shareholders of one or more other nations to propose a Director for election. The number of Directors proposed in this way must not exceed 3.
The total number of Directors cannot exceed 25.
Director elections
Once the proposed Director nominees have been vetted, they are elected as Board Directors by Swift shareholders at the Annual General Meeting for a renewable three-year term. Every year the Board elects a Chair and a Deputy Chair from among its members. It meets at least four times a year.
Director remuneration
Members of the Board do not receive any remuneration from Swift. They are reimbursed for the travel costs incurred in the performance of their mandate.
Board committees
The Board has seven committees. The Committees provide strategic guidance to the Board and the Executive Committee and review progress on projects in their respective areas.
The Audit and Finance Committee (AFC) is the oversight body for the audit process of Swift’s operations and related internal controls. It commits to applying best practice for Audit Committees to ensure best governance and oversight in the following areas:
- Accounting, financial reporting and control
- Legal and regulatory oversight
- Security
- Budget, finance and financial long-term planning
- Ethics programmes
- Risk management (in cooperation with the Franchise Risk Committee (FRC)
- Audit oversight
- The AFC meets at least four times per year with the CEO, CFO, General Counsel and the Chief Auditor, or their pre-approved delegates.
The AFC may request the presence of any member of Swift staff at its discretion. External auditors are present when their annual statements/opinions are discussed and whenever the AFC deems appropriate.
The Banking & Payments Committee (BPC) and the Swift Securities Committee (SSC) focus on segment specific developments, while the Banking Services Committee (BSC) focuses on Standards, Data and APIs (principles of business architecture).
The Franchise Risk Committee (FRC) assists the Board in its oversight of the Company’s management of key risks, including strategic and operational risks, as well as the guidelines, policies and processes for monitoring and mitigating such risks. The FRC’s role includes oversight of risk management of Swift. The FRC coordinates with the Chairs of the AFC and TPC, and focuses on risks not covered by those committees. The FRC is chaired by the Chair of the Board, and includes the Vice- Chair and the Chairs of the AFC, TPC and BSC. The Committee meets at least three times a year, out of the normal Board cycle.
The Human Resources Committee (HRC) oversees executive compensation. It assesses the Company’s performance and decides on the remuneration packages for members of the Executive Committee and other key executives. It monitors employee compensation and benefits programmes, including the provisioning and funding of the pension plans. It also approves appointments to the Executive Committee and assists in the development of the organization, including succession planning. The Board Chair and Deputy Chair are routinely members of the HRC, which meets at least four times per year with the CEO, the Head of Human Resources and the CFO on financial and performance measures. The HRC has delegated powers from the Board in these matters. The HRC also meets without Swift executives several times a year.
The Technology & Production Committee (TPC) covers technology and production risks and developments.
Audit process
Swift’s Chief Auditor has a dual reporting line: a direct functional reporting line to the Chair of the AFC and also a direct administrative reporting line to the CEO. Given the sensitivity of external auditors performing consultancy work for management, the AFC annually reviews spending and trends related to external audit firms. To ensure objectivity, the mandates of the external auditors, as well as their remuneration, are approved by the AFC.
Two mandates for external audit
The Annual General Meeting approved the appointment of PwC as external financial auditor as proposed by the Board of Directors following a competitive tender. This was approved by the works’ council for a mandate of three years ending at the Annual General Meeting of 2024, covering 2021, 2022 and 2023. Their financial Audit Reports can be found in the 2021 Statutory and Consolidated Financial Statements.
Further to their appointment as external security auditor in 2020, Deloitte reviewed and examined in 2021 the adequacy and effectiveness of Swift’s controls in accordance with the ISAE 3000 standard. For the 2021 calendar year, Swift provided six standalone ISAE 3000 Type 2 reports for SwiftNet and FIN, selected on-premise Interface products, Alliance Lite2, T2S, ESMIG and AU-NPP. Each report includes Deloitte’s view on design adequacy and operating effectiveness of the control activities that help achieve the control objectives in the areas of risk management, security management, technology management, resilience and user communication (in line with Annex F of CPMI IOSCO’s Principles for Financial Market Infrastructures). Deloitte’s mandate runs until March 2023 and covers the 2020, 2021 and 2022 calendar years.
User representation
Swift’s National Member Groups and National User Groups help to provide a coherent global focus by ensuring a timely and accurate two-way flow of information between Swift and its users. The National Member Groups comprise all Swift shareholders from a nation, and propose candidates for election to the Swift Board of Directors. They act in a consultative capacity to the Board and Management, and serve the interests of their nation’s shareholders by coordinating their views. Each National Member Group is chaired by a representative who is elected by the Swift shareholders of that nation. National User Groups comprise all Swift users from a nation and act as a forum for planning and coordinating operational activities. Each National User Group is chaired by a representative who is a prime line of communication between the national user community and Swift.
