The National Bank of Ethiopia (NBE) has officially issued a new directive, 'Fit and Proper Criteria for Persons with Significant Influence in Insurance Companies (Directive No. SIB/63/2026),' aimed at enhancing transparency, accountability, and corporate governance within the nation's insurance sector.
Effective as of March 26, 2026, the new regulation introduces stringent requirements for board members and senior executives. Among the most notable changes is a gender diversity mandate: insurance companies are now required to have at least two female members on their boards, ensuring that board composition is not limited to a single gender.
Furthermore, the directive sets a minimum age requirement of 30 years for board members. To ensure independent oversight, each company must appoint three independent board members who hold at least a master’s degree and possess a minimum of 10 years of experience in the financial sector or related fields. Notably, the directive allows for the appointment of non-Ethiopian citizens as independent board members.
For those seeking the position of Chief Executive Officer (CEO), the NBE has established rigorous professional standards. Candidates must demonstrate at least 12 years of experience in the insurance industry, with at least five of those years served in a senior executive capacity. Academically, a minimum of a bachelor’s degree or an internationally recognized professional qualification, such as the Chartered Insurance Institute (CII) diploma, is required.
The directive also enforces strict ethical and financial integrity standards. Individuals with criminal records, or those involved in corruption or fraudulent activities, are barred from leadership roles. Additionally, individuals who are bankrupt or have had assets seized due to bank debt are ineligible for these positions.
To ensure ongoing compliance, the NBE mandates that insurance companies establish robust whistleblowing systems. Companies are also required to notify the regulator immediately if they have concerns regarding the fitness or propriety of their leadership. Failure to comply with the appointment approval timelines will result in a penalty of 10,000 Birr per position.
This move by the National Bank of Ethiopia signals a broader effort to professionalize the financial services industry and protect policyholders by ensuring that only qualified and ethical individuals hold positions of significant influence.
Source: Telegram / tikvahethiopia