Title I - Proportionality
17. The proportionality principle encoded in Article 74(2) of Directive 2013/36/EU aims to ensure that internal governance arrangements are consistent with the individual risk profile and business model of the institution, so that the objectives of the regulatory requirements are effectively achieved.
18. Institutions should take into account their size and internal organisation, and the nature, scale and complexity of their activities, when developing and implementing internal governance arrangements. Significant institutions should have more sophisticated governance arrangements, while small and less complex institutions may implement simpler governance arrangements.
19. For the purpose of the application of the principle of proportionality and in order to ensure an appropriate implementation of the requirements, the following criteria should be taken into account by institutions and competent authorities:
a. the size in terms of the balance-sheet total of t
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