Overview

Independent non-executive directors (iNEDs) with specific Anti-Financial Crime (AFC) and compliance expertise provide boards with seasoned challenge, enhanced governance, and demonstrable oversight capability. In Luxembourg, supervisors expect management bodies to include members who can evidence effective scrutiny of AML/CFT/CPF, restrictive measures (sanctions), and broader financial crime matters. Appointing an iNED with AFC credentials strengthens board competence, supports regulatory engagement, and helps meet fit-and-proper and governance expectations.

Discuss Independent Non-Executive Director (iNED) services Targeted advisory support for Luxembourg regulated entities

Regulatory and board context in Luxembourg

CSSF, AED, and EU guidance emphasise that boards must understand material risks and be able to provide informed challenge.

Key expectations include:

• documented board-level ownership of AFC risk
• membership with appropriate expertise for the entity’s complexity and risk profile
• active engagement in approving and challenging AML/CFT/CPF risk assessments, policies, management information (MI) and remediation priorities
• clear records of challenge and decision-making supporting supervisory review

An iNED focused on financial crime provides independent insight, ensures robust governance, and helps boards demonstrate capacity to oversee AFC controls.

When an iNED with AFC focus is appropriate

Consider appointing an iNED when:

• the board lacks specific AFC/AML/sanctions or compliance experience relative to the entity’s activities
• the entity faces significant remediation, inspection or heightened supervisory engagement
• there is substantial reliance on delegation or outsourced AFC/AML/sanctions activities requiring strengthened board oversight
• investors, service providers or the CSSF/AED expect demonstrable governance strengthening
• the board is preparing for strategic change (new products, markets, digital onboarding) that increases financial crime risk

Our iNED services in Luxembourg

We source and support independent non-executive directors (iNEDs) who have board experience and in-depth knowledge of AFC, as well as expertise in compliance and supervision in Luxembourg. We take a bespoke, pragmatic approach that is aligned with the best governance practices.

Core iNED contributions:

• independent challenge on AML/CFT/CPF risk appetite, risk assessments, policies and material controls
• review and oversight of remediation programmes, sanction risk responses, and transaction monitoring improvements
• scrutiny of management information, KPIs and escalation processes to ensure board quality MI
• oversight of outsourced AFC/AML/sanctions activities and third-party relationships
• supporting nomination and remuneration committees where AFC competencies are relevant
• acting as a credible point of contact in supervisory engagement and inspections
• periodic board education sessions on evolving AFC risks and regulatory expectations

Role clarity, independence and time commitment

iNED appointments must preserve independence and effective governance.

We:

• define clear terms of reference (scope, duties, time commitment, conflict checks)
• ensure independence from executive management and service providers
• propose engagement models (standing board seat, advisory board member, or committee chair) matched to the client’s needs
• agree measurable deliverables and reporting lines to the board and committees

Practical governance benefits

An iNED with AFC expertise helps boards:

• demonstrate competence and meeting supervisory expectations around governance and senior management oversight
• strengthen oversight of delegated functions and service providers
• improve board-level MI and documented challenge required for supervisory review
• reduce regulatory and operational risk through proactive governance

How this service fits within our broader AFC offering

iNED appointments complement our full suite of AFC services – AML/CFT/CPF compliance, AML/CFT/CPF Officer support, interim conducting officer placements, remediation delivery, and CSSF/AED inspection preparation – providing continuity between board oversight and operational improvement.

Contact and next steps

If your board requires independent AFC expertise to meet supervisory expectations, strengthen oversight, or support remediation and strategic decisions, an iNED appointment can provide credible, demonstrable governance.

Discuss Independent Non-Executive Director (iNED) services Targeted advisory support for Luxembourg regulated entities