1. Purpose
The Board Charter outlines the authority, roles, responsibilities, and governance framework of the Board of Directors (“the Board”) of the company. It ensures alignment with the Malaysian Code on Corporate Governance 2021 (“MCCG 2021”), applicable laws, regulations and the Company’s Constitution. The Charter also defines the delegation of responsibilities to Board Committees to enable the Board to operate effectively and in the best interests of shareholders and stakeholders, upholding principles of integrity, transparency and accountability.
2. Authority
The Board derives its authority from the Company’s Constitution and operates in compliance with the Companies Act 2016, Main Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa Securities”), and other relevant laws, guidelines, and best practices.
3. Duties and Responsibilities of the Board
The Board is collective responsibility:
- Providing effective leadership and strategic oversight of the Group.
- Promoting and embedding a culture of good corporate governance and sustainability.
- Ensuring accountability to shareholders and stakeholders.
Key responsibilities include:
- Formulate the Group’s strategic plans and overseeing the implementation of the Group’s business strategies, including economic, environmental, social and governance (“EESG”) considerations;
- Monitoring performance, including financial and operating results and ensuring long term value creation;
- Identifying principal business risks and ensuring adequate risk management and internal control systems are in place;
- Overseeing the conduct of the Group’s business, including compliance with legal and regulatory requirements; and
- Ensure that the Group’s management information and internal controls system are in place and properly implemented.
- Ensure the establishment and effective implementation of the Group’s Anti-Corruption and Bribery Policy and Program, which explain the expected behaviour of Directors, Management and employees in acting with honesty and integrity.
- Ensure the development and implementation of a succession plan for the Board and senior management to promote continuity, stability and effective leadership within the Group.
4. Board Committees
To assist in the effective discharge of its duties, the Board has established the following Committees:
- Audit and Risk Management Committee (“ARMC”)
- Nomination Committee (“NC”)
- Remuneration Committee (“RC”)
Each Committee has its own specific Terms of Reference (“TOR”), as approved by the Board. The powers and authority delegated to these Committees are also set out in the TOR of each of the Committees. The TOR of the Committees will be reviewed periodically to remain current with governance requirements and best practices.
The evaluation of the committees and its members will be performed annually.
5. Roles of Key Positions
The roles of the Chairman and the Managing Director (“MD”) are clearly separated to ensure a balance of power and authority, and to enhance the Board’s independence, objectivity, and effectiveness in overseeing management.
Executive Chairman
The Chairman leads the Board in ensuring its effectiveness, facilitating robust discussions and providing strategic guidance. The Chairman presides at the Board meetings and general meetings of the Company, ensuring orderly conduct and compliance with governance standards and, that the Board functions effectively as a unit. In line with good corporate governance practices, the Chairman is not a member of the ARMC, NC and RC, in order to preserve the objectivity and independence of these committees.
Managing Director
The MD is reporting to the Board and is responsible for the overall leadership, management and performance of the Group’s business. The MD ensures that the Group’s operations are conducted efficiently and effectively, in accordance with the strategic direction, policies and risk parameters established by the Board. The MD also leads the management team and is accountable for delivering sustainable value to shareholders and stakeholders.
Executive Directors
The Executive Directors (“ED”) support the MD in the implementation of the Group’s strategies and the management of day-to-day operations within their respective areas of responsibilities. They are actively involved in operational decision making and work collaboratively with the senior management team to ensure the Group’s business objectives are achieved. ED also contribute to the Board’s deliberations by providing insights from an operational perspective, thereby helping to align management execution with the strategic direction set by the Board.
Non-Executive Directors
The Non-Executive Directors (“NED”), do not participate in the day-to-day management of the Group but play a key role in providing independent oversight and constructive challenge to the executive leadership. NED contribute to the development of the Group’s strategies direction and monitor its implementation, ensuring that decisions are made in the best interests of shareholders and other stakeholders. Through their objectivity and broad experience, NED help uphold high standards of corporate governance, integrity and accountability. Additionally, NED stay informed of relevant legal, regulatory, accounting, governance, business and technology developments to make effective decisions. NED limit their directorships to a manageable number no more than five (5) in listed companies in Malaysia and uphold high ethical standards in line with the Group’s Principles of Business Conduct. NED must declare any actual or potential conflicts of interest before appointment or as soon as they arise.
6. Composition of Directors
Pursuant to the Company’s Constitution, the Board shall consist of a minimum of two (2) directors and a maximum of ten (10) directors.
In accordance with Paragraph 15.02 of the MMLR of Bursa Securities, the Company must ensure that at least 2 directors or 1/3 of the Board, whichever is the higher, of Board members must comprise of Independent Directors who provide independent judgement and objectivity.
The Board shall comprise suitably qualified individuals with diverse set of skills, knowledge, experience, qualities and ability to contribute effectively to the Board.
The size, composition and diversity of the Board shall be reviewed and determined at least annually to reflect the Company’s requirements and to facilitate effective decision-making.
The assessment on the performance of each Director will be performed annually.
7. Maximum Tenure for Independent Directors
The tenure of an Independent Director should not exceed a cumulative term of nine (9) years. Upon reaching the nine-year mark, the Director may be re-designated as a Non-Independent Director or retained as an Independent Director subject to:
- NC and Board evaluation and justification; and
- Annual shareholders’ approval through a two-tier voting process, as recommended under Practice 5.3 of MCCG 2021.
8. Annual Review of Directors
The Board through NC, shall conduct annual performance evaluation of the Directors, Board Committees and overall Board effectiveness. This assessment covers composition, independent, the balance of expertise, experience and skills, quality of information, decision-making processes and boardroom dynamics.
Criteria have been set to assess the independence of independent Directors which are in line with the MMLR of Bursa Securities.
The results of these evaluations will guide ongoing development initiatives and improvements for Directors, Board Committees, and the Board as a whole.
9. New Appointment/Re-election of Director
NC is responsible for evaluating nominee(s) for directorship and subsequently submitting its recommendations to the Board for consideration and decision.
In accordance with the Company’s Constitution, at least one-third (1/3) of the Directors shall retire by rotation at each Annual General Meeting (“AGM”) and may offer themselves for re-election. Additionally, all Directors must retire at least once every three (3) years.
Eligible directors may seek re-election at the AGM, with the NC responsible for recommending to the Board those Directors who are eligible for re-election. Such recommendations are based on a comprehensive review of their performance, consideration factors such as their contribution to the Board, skills, experience, qualifications and their ability to act in the best interests of the Company.
For both new appointments and re-election, the Directors’ Fit and Proper Policy outlines the criteria for candidates, which include assessments of character, integrity, experience, competence, and time and commitment.
In accordance with the Company’s Constitution, any Director appointed during the year must retire and offer themselves for re-election by shareholders at the next AGM following their appointment.
Furthermore, all Board members are required to notify the Chairman prior to accepting any external directorships, to ensure commitment to the Group’s affairs remains undivided.
10. Directors’ Training
All newly appointed Directors are required to complete the Mandatory Accreditation Programme (MAP I and MAP II) as required by the listing requirements of Bursa Securities. The NC is responsible for assessing the training needs of each director and recommending appropriate training programs to enhance their knowledge, skills and overall contribution to the Board.
11. Board Meetings
The Board will have at least four (4) scheduled meetings annually, with additional meetings to be convened as and when necessary.
Board papers with sufficient notice are distributed to Directors at least seven (7) days or such earlier period as agreed by the Board prior to each meeting to enable the Directors to peruse and seek additional information or obtained further explanation on matters to be deliberated.
Directors may participate in Board meetings through telephone, video conferencing, or other forms of audio-visual communication. Participation through such means is deemed equivalent to physical attendance, and the Director shall be entitled to vote and be counted for quorum purposes. All Board meeting proceedings are recorded by the Company Secretaries, reviewed by the Chairman and circulated to all Board members in a timely manner. Minutes of Board Committee meetings are also circulated to the full Board for review, and Directors may seek clarification or provide comments as necessary.
12. Access to Information and Independent Advice
The Board is supplied with, on a timely basis, information in a form and of quality appropriate to enable it to discharge its duties.
Every Director has also access to the advice and services of the Companies Secretary and may obtain independent professional advice at the Company’s expense in furtherance of their duties.
13. Directors’ Remuneration
The Group’s Directors’ Remuneration Framework is designed to attract and retain individuals of high calibre to support the Group’s success. For MD and ED, remuneration packages are structured to link rewards with corporate and individual performance. For NEDs, remuneration reflects their experience, expertise and the responsibilities undertaken. The Board may also consider market benchmarks or recommendations from independent consultants, where relevant.
14. Declaration of Interest and Conflict of Interest
Directors must avoid situations that may give rise to actual or perceived conflicts of interest with the Group. Board members are required to declare any potential or actual conflicts of interest on an annual basis, and as and when such conflicts arise. In accordance with the Companies Act 2016, any Director who has a direct or indirect interest in a contract or proposed contract with the Group must declare the nature of that interest and abstain from participating in any discussion or decision-making related to the matter.
15. Directors’ Code of Ethics
The Company’s Code of Ethics (“COE”) provides the standard of conduct required for directors and employees regarding ethical and behavioural considerations or actions in discharging their duties and responsibilities.
The COE promotes integrity and ethical conduct in all aspects of the Group operations. The areas covered in the COE include dealings in securities, confidentiality of information, conflict of interest, bribery and corruption, gifts and dealings with business partners.
16. Company Secretaries
The Board shall appoint a qualified Company Secretary to serve as the Board’s advisor on corporate governance and regulatory matters. The Company Secretary is responsible for maintaining accurate and up-to-date secretarial records, preparing Board resolutions, and performing other secretarial duties for the Group.
The Company Secretary also keep the Board informed of relevant updates, including changes to the Listing Requirements communicated by Bursa Securities, and provide guidance on corporate disclosures and compliance obligations.
To maintain their effectiveness, the Company Secretary regularly participates in seminars, conferences, and training programs to stay current with regulatory developments, governance best practices, and emerging areas such as sustainability, finance, and accounting.
17. Shareholders Communication
The Board is committed to ensuring timely and transparent communication with shareholders by releasing financial results and relevant announcements that provide a clear overview of the Group’s performance, strategies and other key matters affecting shareholders’ interests.
The MD acts as the primary liaison with major shareholders, engaging in regular dialogue with institutional investors and delivering presentations to analysts and fund managers periodically.
The Board upholds robust corporate disclosure policies and procedures in full compliance with the MMLR of Bursa Securities.
The AGM serves as the key platform for meaningful engagement between the Board, senior management and shareholders. The Board Chairman is responsible for ensuring the AGM fosters open dialogue and that the notice of the AGM is circulated to shareholders at least 28 days prior to the meeting.
18. Review of Board Charter
The Board Charter will be annually reviewed or as and when necessary, by the Board to be updated with the changes in regulations and best practices in order to ensure its effectiveness and relevance to the Board’s objectives.