Board Charter

In this Charter

• “Board” means the Board of Directors of the Company;
• “Board Committees” means committees established by the Board from time to time, including the Audit Committee, Nomination Committee and Remuneration Committee;
• “Bursa Malaysia” means Bursa Malaysia Securities Berhad;
• “Business” means the business of the Company and all its subsidiaries;
• “Chairman” means the Chairman of the Board and is used in a gender-neutral sense;
• “Company Secretary(ies)” means the Board secretary(ies) or the person(s) normally exercising the functions of a Board secretary;
• “Directors” means members of the Board;
• “Group” means the Company and all its subsidiaries;
• “Independent Director” is defined in accordance with Paragraph 1.01 of the Listing Requirements;
• “Listing Requirements” means the Main Market Listing Requirements of Bursa Malaysia;
• “Management” means the management personnel of the Group; and
• “Shareholders” means the shareholders of the Company.

The Board is collectively responsible for the proper stewardship of the Group’s business and the creation of long term shareholder value, whilst taking into account interests of other stakeholders.

The principal responsibilities of the Board are as follows:

1. reviewing and adopting a strategic plan, as developed by Management, taking into account the sustainability of the Company’s business, with attention given to the environmental, social and governance aspects of the business;
2. overseeing the conduct of the Company’s business, including monitoring the performance of Management to determine whether the business is being properly managed;
3. identifying principal business risks faced by the Group and ensuring the implementation of appropriate internal controls and mitigating measures to manage such risks;
4. succession planning - ensuring that all candidates appointed to senior management positions are of sufficient calibre and that there are programmes to provide for the orderly succession of senior management;
5. reviewing the leadership needs of the Company, both executive and non-executive, with a view to ensuring the Company’s continued ability to compete effectively in the marketplace;
6. overseeing the development and implementation of a shareholder communication policy;
7. reviewing the adequacy and integrity of the Company’s management information and internal control systems, ensuring there is a sound framework of reporting internal controls and regulatory compliance; and
8. overseeing the Group’s adherence to high standards of conduct or ethics and corporate behaviour, including the Code of Ethics for Directors set out in Appendix A of this Charter.

In discharging the above responsibilities, Directors are expected to:

1. be aware of the environment the Group is operating in;
2. exercise diligence and avoid undeclared conflict of interest situations;
3. understand their oversight role, including the exercise of independent and objective judgment in decision making;
4. commit and devote sufficient time and efforts in discharging their duties responsibly;
5. contribute actively in Board discussion and deliberation of issues by providing sound advice based on the Directors’ experience and specific expertise they bring to the Board; and
6. attend regular training programmes in order to be apprised of changes in regulatory requirements the Group is subjected to.

To ensure the direction and control of the Company are in the hands of the Board, a formal schedule of matters reserved for the Board’s deliberation and decision is set out in Appendix B of this Charter.

Board balance and composition

1. The Board shall be helmed by a Chairman, appointed by the Board, and comprise at least two (2) members or one-third (⅓) of the Board, whichever is higher, who are Independent Non-Executive Directors (“IDs”) in accordance with the Listing Requirements.
2. The tenure of ID shall be for a cumulative term of nine (9) years since appointment as ID. The ID may continue to serve on the Board beyond the nine (9)-year tenure provided the ID is re-designated as a Non-Independent Director. Where the Board is of the view that the ID can continue beyond the nine (9)-year tenure, it must justify and seek shareholders’ approval. The Board shall also identify, from amongst its members for inclusion in the Company’s Annual Report, a Senior Independent Non-Executive Director to whom concerns of fellow Directors, shareholders or stakeholders may be conveyed.
3. Whilst the Company’s Articles of Association allow for no less than two (2) or more than eleven (11) Directors, the Board shall examine and determine its size periodically in relation to the effective running of the Company’s business.
4. To enhance its effectiveness, the Board shall ensure its members have the relevant skills, experience, expertise and time commitment. The Nomination Committee is, therefore, entrusted by the Board to appraise candidates for directorship, including those who retire and offer themselves for re-election, before recommending to the Board.
5. The composition of the Board shall be assessed by the Nomination Committee, to ensure the Board is of an appropriate mix to optimise the Board’s performance, as a whole, and align the Board’s capabilities with the Company’s strategic direction.
6. Directors shall not sit on the boards of more than five (5) listed issuers and before accepting any new directorship, Directors shall notify the Chairman, the notification of which shall include an indication of time that will be spent on the new appointment.

Roles of Chairman

The Chairman assumes a leadership role in the Board and represents the same to shareholders of the Company. The Chairman is primarily responsible for the following:

1. presiding at Board and shareholder meetings and ensuring the proceedings thereof comply with good conduct and practices;
2. ensuring the adequacy and integrity of the Board governance processes;
3. consulting with the Board promptly over any matter that gives him cause for major concern;
4. managing Board communications and Board effectiveness;
5. ensuring timely dissemination of notice of meeting and agenda to Directors, including relevant Board papers and information pertaining to issues scheduled for discussion and/or approval at meetings;
6. acting as facilitator at Board meetings and ensuring that no member, whether executive or otherwise, dominates discussion. The Chairman shall also encourage Board members to participate in discussions and that relevant opinions amongst members are forthcoming, resulting in logical and understandable outcomes; and
7. other responsibilities as assigned by the Board from time to time.

Roles of President/Chief Executive Officer and Executive Directors

1. The President/Chief Executive Officer (“President/CEO”), assisted by his fellow Executive Directors (“EDs”), serves as a conduit between Management and the Board and is responsible for the effective implementation of the Company’s strategic plan and policies established by the Board, besides managing the daily operations of the Company.
2. Generally, the President/CEO, assisted by his EDs as the case may be, is responsible to the Board for the following:
1. achievement of agreed Company’s goals and observance of Management authorities delegated by the Board;
2. developing long-term strategic and short-term business plans, designed to enable the Company’s requirements for growth, profitability and return on capital are achieved, subject to the Board’s review and adoption;
3. providing assistance to members of the Board and the Board Committees, as required, in discharging their duties; and
4. assisting the Chairman in organising information necessary for the Board to deal with the agenda and for providing such information to Directors on a timely basis.
3. The Board shall receive the following from or through the President/CEO at its scheduled meetings:
• reports on the performance and activities of the Group for the period under review, including explanations for significant fluctuations over the period; and
• where appropriate, a briefing pertaining to risk management issues, challenges faced by the Group, changes to legislations that may affect the Group’s operations, litigations and other salient events or issues affecting the Group.
4. The President/CEO and his fellow EDs shall act within all specific authorities delegated to them by the Board.
5. In discharging the above responsibilities, the President/CEO can delegate appropriate functions to any member of Senior Management, including EDs, who shall report to the President/CEO.

Roles of Non-Executive Directors (“NEDs”)

The roles of NEDs largely encompass the monitoring of Company performance and contributing to the development of Company strategy, clarified as follows:

1. Strategy: Constructively challenge and contribute to the development of Company strategy; and
2. Performance: Oversee the performance of Management in meeting agreed goals and objectives and monitor the reporting of performance.

Company Secretary(ies)

1. The appointment and removal of the Company Secretary(ies) is a matter for the Board, as a whole. The Company Secretary(ies) shall be suitably qualified and capable of carrying out the duties required of the post.
2. The Company Secretary(ies) is expected to provide unimpeded advice and services to the Directors, as and when the need arises, to enhance the effective functioning of the Board and to expedite regulatory compliance.
3. The primary responsibilities of the Company Secretary(ies) include the following:
1. ensuring that Board procedures and applicable rules are observed;
2. maintaining records of the Board and Board Committees and their respective meetings and ensuring effective management of the Company’s records;
3. preparing comprehensive minutes to document Board and Board Committee proceedings and ensure conclusions are accurately recorded;
4. timely dissemination of information relevant to Directors’ roles and functions and keeping them updated on new or evolving regulatory requirements; and
5. carrying out other functions as deemed appropriate by the Board from time to time.

Board Committees

1. The Board shall establish Committees from time to time to assist the Board in the discharge of its duties and responsibilities. Each Committee has its own terms of reference in writing, specified by the Board, detailing its roles and responsibilities, structure and composition.
2. The following standing Committees, with written terms of reference, have been established by the Board:
1. Audit Committee
   The Audit Committee assists and supports the Board primarily in the area of financial reporting in liaison with the external auditors and the Group’s system of risk management and internal control in liaison with the internal auditors;
2. Nomination Committee
   The Nomination Committee assists the Board on matters relating to the selection and assessment of Directors;
3. Remuneration Committee
   The Remuneration Committee assists the Board on matters relating to the remuneration of Directors.

The Board’s relationship with shareholders and stakeholders

1. The Board shall maintain a communications policy that enables both the Board and Management to communicate effectively with the Company’s shareholders, stakeholders and the general public.
2. The Board shall arrange for the General Meetings of the Company to be conducted in an efficient manner to enhance shareholder communications. The Board shall also provide timely and relevant information to shareholders and encourage their active participation at the meetings, taking into account the following measures:
1. ensure that each item of business included in the notice of meeting is accompanied by a full explanation of the effects of the proposed resolution;
2. ensure that a brief description, including information such as age, relevant experience, list of directorships, date of appointments to the Board, details of participation at Board Committees and designation of Directors (Independent or Non-Independent), in respect of the Directors standing for re-election or re-appointment, is disclosed in the Annual Report;
3. the Chairman shall provide reasonable time for discussion at the meeting. Where appropriate, the Chairman will undertake to provide the shareholder with a written response to any significant question which cannot be answered immediately; and
4. consider the need for substantive resolutions, including, but not limited to, related party transactions to receive specific shareholder approval by way of poll and announce the detailed results of the votes cast for and against each resolution. The Chairman shall also inform shareholders of their right to demand a poll vote at the commencement of the General Meeting subject to Company’s Articles of Association.

Board Meetings

1. Meetings shall be conducted at least on a quarterly basis. The Company Secretary(ies) shall prepare and distribute to all Directors in advance a timetable for the meetings for the year. The Company Secretary(ies) shall work together with the Chairman in developing the meeting agenda.
2. Except in the case of emergencies, seven (7) days notice of every Board meeting will be provided in writing. In addition to notices sent through post or by hand, notices may also be sent via facsimile, electronic mail or by any means of telecommunication in a permanent written form.
3. The Chairman of the Board - or in his absence, a Director from amongst the Board members appointed - shall preside at all meetings.
4. Board members are required to attend Board meetings. However, other senior officers may be invited to attend meetings for particular items within their responsibility. The Board may also invite external parties such as the auditors, solicitors and consultants as and when the need arises. Resolutions at any meeting of the Directors shall be decided by a majority of votes.
   
   Resolutions of the Directors at a meeting or adjourned meeting of the Directors shall be adopted by a majority of votes of all Directors present. In the event matters requiring Board’s decision arise between meetings, such matters shall be resolved through circular resolution which shall be supported by relevant papers setting out details of the subject matter. The Board members may obtain more information from Management and express their view points by facsimile, electronic mail or any other means of telecommunication before arriving at a decision on the subject matter. All such resolutions shall be submitted for confirmation or ratification at a meeting of the Board following the passing of the circular resolutions.
5. The Directors may participate at a meeting of the Directors by means of telephone and video conference or by other means of communication. The physical presence of Director(s) is not compulsory and participation at the meeting in the aforesaid manner shall be deemed to constitute presence in person at such meeting. The Directors participating at any such meeting shall be counted in the quorum for such meeting. All resolutions agreed upon by the Directors at such a meeting shall be deemed to be as effective as a resolution passed at a meeting in person of the Directors duly convened and held. All information and documents must be made equally available to all participants prior to, at, or during the meeting.
6. Pursuant to regulatory requirements, a Director shall abstain from deliberation and voting on contracts or proposed contracts or arrangements in which the Director has direct and/or indirect interests.

Agenda

The Chairman, in conjunction with the Company Secretary(ies), shall assess the type of information needed to be supplied to the Board and the contents of the agenda. The agenda shall include, amongst others, matters specifically reserved for the Board’s decision. The Board shall record its deliberation, in terms of the issues discussed, and the conclusions thereof, in discharging its duties and responsibilities.

Meeting papers

1. To allow sufficient time for Directors to consider the relevant information, Board papers and agenda items are to be circulated at least seven (7) days, or a shorter period where unavoidable, prior to the meeting. Where there is a need to table a report, a brief statement of findings and/or recommendations is prepared.
2. Minutes are prepared following a Board meeting. The draft minutes shall be tabled at the following meeting for confirmation and signing.

Access to information

All Directors shall have unrestricted access to Management and to information pertaining to the Company and its subsidiaries, including access to the Company auditors and consultants, relevant to the furtherance of their duties and responsibilities as Directors of the Company.

Independent professional advice

1. In discharging the Directors’ duties, each member of the Board is entitled to obtain independent professional advice with the cost thereof borne by the Company.
2. Where such advice is considered necessary for the discharge of his duties and responsibilities as Director and, for the benefit of the Company, such Director shall first discuss it with the Chairman and, having done so, shall be free to proceed, where appropriate.

Directors are required to undergo the mandatory accreditation programme under the auspices of Bursa Malaysia. In addition, Directors are required to attend relevant training courses or seminars at periodic intervals to keep themselves updated on developments pertaining to the oversight function of Directors as well as technical matters, for example, financial reporting standards, tax budgets, etc. The Nomination Committee shall decide on the continuous education training programme for Directors.

All trainings attended by Directors shall be disclosed in the Annual Report. In special circumstances, valid justifications for non-attendance at any training by Directors for the financial year shall also be disclosed.

A Director who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the Company shall declare the Director’s interest in accordance with the Companies Act, 1965. The Director concerned shall not participate in deliberations and shall abstain from casting votes in any matter arising thereof unless as otherwise provided for in the Companies Act, 1965.

Should there be an actual, potential or perceived conflict of interest between the Company or a related corporation and a Director, or an associate of a Director such as a spouse or other family members, the Director involved shall make full disclosure and act honestly in the best interest of the Company.

Directors shall devote sufficient time to carry out their responsibilities. The Board shall obtain this commitment from its members at the time of appointment. Each Director is expected to commit time as and when required to discharge the relevant duties and responsibilities, besides attending meetings of the Board or Board Committees.

The Company Secretary(ies) shall facilitate the Directors’ annual independence and conflict of interests declarations, which will allow the Directors to perform an annual self-declaration on independence (i.e. for Independent Non-Executive Directors) and conflict of interest (i.e. for all Directors).

NEDs will be paid a fee for acting as Directors of the Company, subject to approval by shareholders.

The remuneration of EDs shall be recommended by the Remuneration Committee with the individual Director concerned abstaining from discussing his individual remuneration. The amount of remuneration payable shall be determined with reference to corporate and individual performance of Directors.

The Nomination Committee is entrusted by the Board to review the performance and effectiveness of the Board and Board Committees, including individual Directors, annually, with the assessment report, together with a report on the Board balance covering the required mix of skills, experience and other qualities of Board members for discussion at the full Board.

The Board shall have relevant corporate disclosure policies and procedures to ensure comprehensiveness, accuracy and timeliness of information disclosed. These policies and procedures shall ensure compliance with the relevant disclosure requirements as enumerated in the Listing Requirements.

The Company shall consider the use of information technology in communicating with stakeholders, including a dedicated section for Investor Relations on the Company’s website. This section shall provide information such as, amongst others, the Board Charter and the Annual Report of the Company.