Governance Structure

Our governance structure comprises the policies, standards and procedures we use to direct and control the management of our governance bodies. It encompasses relationships with shareholders, the Board of Directors and its committees, and the business functions and reports on key roles: Chair of the Board of Directors, CEO and other officials and directors.

The Board of Directors and its Committees are responsible for authorizing the Governance Model and Corporate Frameworks that comprise the Group’s Internal Governance system, in accordance with local regulations and legislation. Furthermore, they are tasked with monitoring and evaluating any impacts, risks and opportunities relating to Environmental, Social and Governance (ESG) issues.

Board of Directors

Our Board of Directors is a one-tier group that assesses and analyzes material, social, environmental, economic and ethical issues, in addition to the opportunities, impacts and risks associated with the proper implementation of the Bank’s Responsible Banking strategy.

Our Board of Directors is composed of 22 members: 11 Proprietary and 11 Alternate members. The Board of Directors is responsible for assigning members to Committees.

During 2022, the Board of Directors met on six occasions, on the following dates: January 27, April 28, June 16, July 21, September 22 and October 27. During these sessions, the most relevant sustainability issues for the Bank’s operations were identified and the review of the effectiveness of the organization’s processes are contained in the minutes of the sessions for follow-up purposes.

At least once a year, an item is discussed during a meeting of the Board of Directors regarding the development of climate strategy, climate project and ESG reporting.

The Board of Directors is comprised of the following Committees:

Audit Committee (CA).
Remuneration Committee (CR).
Comprehensive Risk Management Committee (CAIR).
Corporate Practices, Nomination and Remuneration Committee (CPSNC).

Board of Directors Appointment Process

The management and representation of the company is undertaken by a Board of Directors, at least 25% of whom must be Proprietary members. For each Proprietary director, a respective Alternate director must be appointed, in the understanding that the Alternate directors must have the same character as Independent directors.

For a director to be appointed, he or she must have the knowledge, skills, experience necessary and competencies relevant to the impacts of the organization in terms of legal, banking-financial, accounting, administrative and auditing to understand the risks and ESG issues, including climate change, that could affect the Bank.

All Directors who accept their appointment to the Board of Directors must take an induction course to help familiarize themselves with the mission and vision of the Bank. This training program focuses on the following areas:

The rights and obligations of Directors.
Internal Santander procedures and policies.
The Bank’s strategic businesses and plans (including risks).
Meetings with senior management.
General overview of the Governance Model and good governance practices.

Furthermore, the Board of Directors must ensure that the selection processes for its members favors gender diversity, experience and knowledge, avoiding implicit bias that could lead to any form of discrimination. The procedures should focus particularly on favoring the selection of female Board Members.

To learn more about the qualitative composition of the Board of Directors, please click here.

Appointment:

This involves coordination between the local and Group Nomination Committees to present a proposal, which is validated by the Group’s Nominations Committee and approved by the Shareholders’ Meeting. In this process, minority rights are respected.

Members:

Between 7 and 15 Board members, who serve a tenure of three years with the opportunity to be re-elected every year.

Sessions:

Six sessions per year lasting a maximum of five hours, including an extended session to focus on business strategies.

Assessment:

An assessment of the Board will be conducted on an annual basis.

Compensation:

It will be proposed by the chair of the Board of Directors in Mexico, ratified by the Group’s Remuneration Committee, validated by the Corporate Practices, Nomination and Remuneration Committee in Mexico, and authorized by the Shareholders’ Meeting in Mexico.

Core Issues:

Strategies.
Structure and capital.
Financial and communication reports and situation.
Appointment, removal and remuneration of officers.
Risks and compliance and conduct.
Board succession plan.
Supervision of compliance with Corporate Governance policies.
Operation with interested parties.
Conflicts of interest.
Internal governance.
Key positions.
Authorization of general and specific policies, including, if applicable, adherence to those passed by the Group’s Board of Directors.
Authorization of Internal Audit Plan.

Lead Independent Director:

The Board will appoint a Lead Independent Director in the event that the Chair of the Board of Directors is not Independent.

Composition of the Board of Directors

Name	Age	Executive / Non-Executive	Proprietary / Alternate	Years of Service	Governance Body and Committees	Sex (F/M)
Laura Renee Diez Barroso Azcárraga	71 years	Non-Executive F Series	Chairwoman of the Board / Independent Proprietary	2 years	Board of Directors	F
César Augusto Montemayor Zambrano¹	63 years	Non-Executive F Series	Independent Proprietary	3 years	Board of Directors, CAIR	M
Juan Ignacio Gallardo Thurlow	75 years	Non-Executive F Series	Independent Alternate	9 years	Board of Directors	M
Alberto Torrado Martínez	59 years	Non-Executive F Series	Independent Alternate	13 years	Board of Directors, CPSNC, CAIR	M
Felipe Francisco García Ascencio	51 years	Executive F Series	Non-Independent Proprietary	3 months	Board of Directors, CAIR	M
Héctor Blas Grisi Checa²	56 years	Executive F Series	Non-Independent Proprietary	7 years	Board of Directors	M
Magdalena Sofía Salarich Fernández de Valderrama	66 years	Executive F Series	Non-Independent Proprietary	3 years	Board of Directors	F
Ángel Rivera Congosto	56 years	Executive F Series	Non-Independent Proprietary	7 years	Board of Directors	M
Didier Mena Campos	52 years	Executive F Series	Non-Independent Alternate	4 years	Board of Directors, CAIR	M
Rodrigo Brand de Lara	50 years	Executive F Series	Non-Independent Alternate	4 years	Board of Directors	M
Ángel Alverde Losada	56 years	Non-Executive F Series	Independent Alternate	8 months	Board of Directors, CR, CPSNC	M
Daniel Barriuso Rojo	49 years	Executive F Series	Non-Independent Proprietary	8 months	Board of Directors	M
Pablo Fernando Quesada Gómez	60 years	Executive F Series	Non-Independent Alternate	3 months	Board of Directors	M
José Antonio Pérez Antón	50 years	Non-Executive F Series	Independent Alternate	8 months	Board of Directors	M
Bárbara Garza Lagüera Gonda³	62 years	Non-Executive B Series	Independent Proprietary	3 years	Board of Directors	F
Antonio Purón Mier y Terán⁴	70 years	Non-Executive B Series	Independent Proprietary	13 years	Board of Directors, CA, CPSNC, CR	M
María de Lourdes Melgar Palacios	60 years	Non-Executive B Series	Independent Proprietary	4 years	Board of Directors, CA, CAIR	F
Rogelio Zambrano Lozano	66 years	Non-Executive B Series	Independent Alternate	4 years	Board of Directors	M
Guillermo Francisco Vogel Hinojosa	72 years	Non-Executive B Series	Independent Alternate	6 years	Board of Directors	M
Joaquín Vargas Guajardo	68 years	Non-Executive B Series	Independent Alternate	13 years	Consejo de Administración, CAIR	M
Melanie Elizabeth Devlyn Gómez	55 years	Non-Executive B Series	Independent Alternate	8 months	Board of Directors	F
Guillermo Jorge Quiroz Abed⁵	69 years	Non-Executive B Series	Independent Proprietary	4 years	Board of Directors, CA, CR, CPSNC	M

CA (Audit Committee); CR (Remuneration Committee); CAIR (Comprehensive Risk Management Committee); CPSNC (Corporate Practices, Nomination and Remuneration Committee).
1. Chairman of CAIR (Comprehensive Risk Management Committee).
2. Héctor Blas Grisi Checa resigned from the Board of Directors on December 31, 2022.
3. Bárbara Garza Lagüera Gonda resigned from the Board of Directors on January 25, 2023.
4. Chairman of CPSNC (Corporate Practices, Nomination and Remuneration Committee) and CR (Remuneration Committee).
5. Chairman of the CA (Audit Committee).

Committee	# Independent Directos	# Non-independent directors	# Executive Directors	# Non-executive Directors
CA (Audit Committee)	3 (13.6%)	0	0	3 (13.6%)
CR (Remuneration Committee)	3 (13.6%)	0	0	3 (13.6%)
CAIR (Comprehensive Risk Management Committee)	4 (18.2%)	2 (9.1%)	2 (9.1%)	4 (18.2%)
CPSNC (Corporate Practices, Nomination and Remuneration Committee)	4 (18.2%)	0	0	4 (18.2%)

Committee Members who are not Members of the Board of Directors:

Name	Executive/ Non-Executive	Independence	Committee Members	Sex (F/M)
Fernando Borja Mujica	Executive	Non-Independent	CAIR	M
Emilio de Eusebio Saiz	Executive	Non-Independent	CAIR, CR	M
Ricardo Alonso Fernández	Executive	Non-Independent	CAIR, CR	M
Alejandro Diego Cecchi González	Executive	Non-Independente	CAIR	M
Ana Felisa López Escobar	Executive	Non-Independent	CR	F
Norma Angélica Castro Reyes	Executive	Non-Independent	CAIR	F

Training for Members of the Board of Directors

We coordinate a number of activities to help drive the knowledge, skills and experience of our Directors in terms of sustainable development:

Name of Course	Description
Board Member Induction Course	Offered on June 14, 2022, via Diligent, this course focuses on a range of topics such as Corporate Governance, Strategy and Plans, Risks, Money Laundering Prevention, Retail Banking, SME’s and Companies, Technology Plan, Responsible Banking and ESG, and Internal Audits, among others.

Assessment of Members of the Board of Directors

Target setting, performance evaluation and the variable remuneration of the members of the Board of Directors is undertaken in accordance with local regulations and in keeping with the Governance Model.

As part of the annual evaluation process, and through a self-assessment completed by the Directors, questions are posed to evaluate the performance of the Board of Directors in supervising the impact the organization has on the environment, the economy and people.

A self-assessment is completed by the Directors and focuses on the following areas: discussions within the Board and decision- making processes; the functioning of the committees; regulations and compliance applicable to the Bank; corporate governance; time spent on work relating to the Board of Directors; knowledge of the company and its operations; risk and crisis management; strategic management and implementation; work and personal environment; and, community relations.