Human Resources and Code of Conduct

The strategy of the Human Resources Department was formulated bearing in mind that human resources are the driving force for the Group's success. The key strategic objectives were, on the one hand, the support of the Group's expansion in Greece and, on the other hand, the control of operating expenses relating to human resources.

Attracting High-Calibre Officers

In Cyprus, particular emphasis was placed on attracting and recruiting holders of post-graduate degrees. These individuals were selected and recruited through the Bank's selection and recruitment procedures to ensure that they have the required skills for a career with Bank of Cyprus. Recruitments of clerical staff were contained to a minimum and the effort was focussed on better utilising existing staff. In Greece, 213 new members of staff were recruited during 2002. The expansion of the Group's operations and branch network in Greece establish it as a preferred employer. According to the recent publication 'The 100 Most Progressive Corporate Employers', the Bank is one of the most progressive employers in Greece.The Group's strategy in the United Kingdom was the reduction of staff to 246,down from 277 in 2001. This reduction took place through retirements, voluntary resignations and the non-replacement of staff on short-term contracts.The Bank in Australia is at the initial stages of its expansion. There are significant opportunities for the recruitment of high-calibre individuals, whilst also providing motives for the promotion and development of existing staff.

Staff Assessment / Promotion

Staff assessment and promotion relies on meritocratic processes and criteria in order to sustain the existence of capable staff members at all levels. The Group's policy is the appointment of existing members of staff to fill vacant positions. This is achieved through a detailed succession plan.

During 2002, the Group in Cyprus continued the successful implementation of the innovative annual assessment system introduced two years ago. This system places particular emphasis on the identification of targets and the assessment of the employees performance against those targets. The system also focuses on staff personal development, while avoiding the problems of traditional assessment systems which, inter alia, use a scoring system. The philosophy of the assessment system is to rely on an open and interactive communication process between the assessors and those being assessed.

In addition to the annual staff assessment system, the Group carries out other types of assessment, such as upward appraisal of officers and the 360 Assessment of staff behaviour by various sources, such as their manager, colleagues and members of staff.

The annual staff assessment system of the Bank in Greece is different to that of Cyprus, but has similarities in that it also relies on the open and interactive communication between the assessor and the individual being assessed, it uses similar areas of competency for the assessment of each individual and it places emphasis on the personal development of staff. Upward appraisal is also implemented by the Group in Greece. The assessment of middle management is complemented by the use of a Professional Skills Profiling tool during the Staff Development Centres.

In the United Kingdom, the staff assessment system is a competence management system and is directly linked to staff rewards. Supervisors and managers received extensive training on the system during 2002.

Staff Motivation / Incentives / Staff Satisfaction

The Group's philosophy regarding staff motivation relies on respect, recognition of effort and achievements, open communication and understanding, and fulfilment of the employees needs. The emphasis placed on staff training and personal development, both in Cyprus and abroad, serves as a source of motivation and reward for employees.

Staff Training and Development

The objective of the Training and Development Unit is to support the Group in achieving its strategic objectives, in operating effectively in all areas and in ensuring that employees adapt to the changes that are continuously taking place. Through the professional training of employees and the development of their skills, staff is in a position to offer the best possible level of customer service, to increase its productivity and generally achieve the Group's objectives. Investment in training continued during 2002, through seminars as well as on-the-job training. The average training time per Group employee in 2002 was around 3 days.

During 2002, particular emphasis was placed on the training of multi-functional tellers and the continuous upgrading of the quality of customer service. Other areas of focus for training purposes were those of lending, information technology and security. The revision of the seminar content continued during 2002, covering both technical areas as well as personal development issues for both clerical and managerial staff. The training programme for newly-recruited graduate trainees was also revised.

Taking into account the latest developments in the area of training, the Group implemented a distance learning programme on a pilot basis. The distance learning programme uses the latest technology, with a view to incorporating it in the Bank's existing training programme. In Greece, the main innovations in the training area during 2002 were the implementation of e-learning for personal development courses and the operation of a dummy branch for the training of new members of branch staff.